Hong Kong, April 11 (ANI): As China has recorded the lowest economic growth in four decades in the year 2020, the non-performing debt at its four biggest banks swells 22 per cent last year, with the balance set to skyrocket this year if state-mandated loan extensions expire.
According to Nikkei Asia, the Big Four banks reported that the balance of bad debt stood at 999.1 billion yuan ($152.5 billion) at the end of December, up 181 billion yuan from a year earlier.
"The nonperforming debt stems mainly from the manufacturing, wholesale, retail and service sectors," Zhang Xuguang, an executive vice president at Agricultural Bank of China, said during a teleconference, as reported by the Asian outlet.
The average ratio of bad debt among the four banks rose 0.14 points from the end of 2019 to 1.54 per cent, marking the first uptick in four years. Losses from bad debt rose 16% collectively, which put downward pressure on earnings.
In January, China has recorded the lowest economic growth in four decades as it grew by 2.3 per cent according to the latest data provided by the National Bureau of Statistics.
The statistics bureau cited that the reason behind a slow economic growth was due to the coronavirus pandemic. South China Morning Post reported that the country's growth rate last year was the lowest since the nation's economy "shrank by" 1.6 per cent in 1976.
South China Morning Post further reported that the surveyed jobless rate, an 'imperfect' measurement of unemployment in China which does not include figures for the tens of millions of the nation's migrant workers, stood at 5.2 per cent in December, unchanged from November.
The fixed-asset investment grew by 2.9 per cent over the course of 2020 compared to 5.4 in 2019. (ANI)