March 6, 2020 / 1:58 PM / 22 days ago

China's banking regulator sees rise in bad loans, says China can absorb risks

BEIJING (Reuters) - The coronavirus outbreak has led to an increase in the Chinese banking sector’s non-performing loans, but the banking regulator said on Friday that such rises would be transient and China was capable of absorbing related financial risks.

“There is no economic and financial basis for continued big rises in non-performing loans,” China’s Banking and Insurance Regulatory Commission (CBIRC) said in a statement on its website, adding that shocks brought on by the coronavirus would be short-lived.

It said added China’s average capital adequacy ratio of 14% gave it the capacity to absorb coronavirus-induced financial risks.

Reporting by Roxanne Liu, Meg Shen and Leng Cheng, Editing by Kevin Liffey

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