February 25, 2020 / 9:33 AM / a month ago

China to see small rise in bad loan ratio, impact limited - state media

BEIJING, Feb 25 (Reuters) - China’s banking and insurance regulator said on Tuesday there will be a small rise in the country’s non-performing loan (NPL) ratio in the near term, but the impact will be limited.

China has taken some temporarily measures, including allowing firms affected by the coronavirus outbreak to delay loan repayments.

But these measures come with conditions and a time limit, Xiao Yuanqi, the spokesperson of the China Banking and Insurance Regulatory Commission said, according to state-owned Financial News.

If firms miss payments on loans after business conditions returned to normal, those will still be recorded as non-performing loans, Xiao said.

The country’s banking system had sufficient capital reserves to cope with a small rise in the NPL ratio, he added.

Reporting by Cheng Leng, Zhang Yan and Se Young Lee; Editing by Andrew Heavens

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