Chinese Regulators Tighten Grip on Disguised Loans
(Beijing) — Channel lending in China, albeit sprawling, is still caught in a regulatory no-man’s land.
Chinese banks have been skirting more-stringent requirements on capital and loan-loss provisioning by disguising loans routed through non-banks, or so-called “channels,” as asset-management plans (AMPs).
AMPs fetch high returns from investing in high-risk local government financing vehicles, less-capitalized property projects, or companies whose credit profile is too weak to secure conventional bank loans. These AMP-disguised loans as a result have managed to stay off the radar of traditional debt indicators.
- 1Wukong Becomes China’s First Bike-Share Failure
- 2Tencent Unveils Plan to Create Electronic Sports Gaming Empire
- 3Viewers Wince as Beloved Japanese TV Drama Gets Tasteless Remake in China
- 4The Silver Way: How Mexican Silver Coins Paved a 16th-Century Sea Route to China
- 522-Year-Old Man Identified as Suspect in Kindergarten Explosion