China’s non-performing real estate loans soar, says report
Annual market survey shows that real estate NPL will reach US$13.59 bn, a dramatic increase since 2013
By the end of this year, the balance of non-performing loans of the domestic real estate industry will reach 85.5 billion yuan (US$13.59 billion), while the non-performing loan ratio will reach 1.5%, according to a study reported by eeo.com.cn.
The annual market survey of China’s Financial Non-performing Assets published by China Orient Asset Management also shows that 32.8% of respondents believe that manufacturing has the most significant increase in the number of non-performing assets in 2018, while 30.3% of respondents think that is real estate sector.
The report says since 2013, the scale of non-performing loans in the real estate industry has grown rapidly, especially in 2015, reaching a rate of 73%. In 2018, the growth rate is expected to be no less than 20%.
However, Pan Gongsheng, deputy director of the central bank, said in early March that banks and financial institutions have less than 1% of bad loans for real estate loans, compared to the overall banking industry’s non-performing loan ratio of 1.85%.