Practical analysis for investment professionals

shadow banking

Insights on China’s Growth, Real Estate Market, and Shadow Banking

With its GDP growth slowing to 7.4% in the first quarter this year, will China continue to be the world’s growth engine? Will the cooling real estate markets in some Chinese cities pose a threat to the shadow banking industry and the overall financial system?

Shadow Banking Is Hurting China’s Banks — And That’s a Good Thing

No doubt shadow banking in China is large (30% of total banking assets, according to JPMorgan’s estimates) and carries unknown risks. But China’s problem is not shadow banking itself, it is a dysfunctional credit system.

Joe Zhang on China’s Credit Crunch, Microcredit, and Systemic Risk

Joe Zhang, chairman of Wansui Micro Credit, says there is no problem with shadow banking in China; microcredit actually provides an invaluable service to small businesses. The key policy issue is how to make solid progress in liberalizing interest rates and ending financial repression.

Fraser Howie on China: Expect Nasty Shocks to Bank Balance Sheets

In the second installment in our series of interviews with experts on China, Fraser Howie explains why he thinks recent actions by the PCOB will fall far short of resolving the country's banking problems.

Michael Pettis on China: Too Much Credit Not Just a Problem for Shadow Banking System

Recent attempts by the People’s Bank of China to limit shadow banking have sent commercial lending rates soaring and Chinese stocks into bear market territory. In this first installment in a series of interviews featuring China experts, we ask Michael Pettis for his analysis on recent events.

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