China bad loans rise for 5th quarter

Bad loans rose by 64.7 billion yuan (US$10.4 billion) to stand at 492.9 billion yuan at the end of 2012.

However, the nonperforming loan (NPL) ratio showed a 0.01 percentage point fall, to 0.95 percent.

The figures also showed that in January, China's banks extended 1.07 trillion yuan in loans, the highest monthly total in the last three years, and analysts said the growth in new loans might help keep the NPL ratio at a relatively low level.

Guo Tianyong, a finance professor at the Central University of Finance and Economics, said that China's bad loans level is now in a “subtle” period in which the scale is increasing, but the overall risk is still under control.

Zhao Qingming, a financial expert, was quoted by Reuters as saying that as China's macroeconomic condition improved over the past year, both the level of China's bad loans and nonperforming loan ratio might drop.

The combined net profits of China's commercial banks rose to 1.24 trillion yuan (US$197.5 billion) in 2012, an increase of 18.9 percent from a year earlier, according to the CBRC.

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