The fear is that banks are not capable of supporting multiple crises: loans, housing bubble and currency values. For the Chinese Central Bank, the IMF report "is not sufficiently objective." This year, Chinese financial shares were down 23%.
Beijing (AsiaNews / Agencies) - The International Monetary Fund (IMF) has warned China about the possible "fragility" of its financial system. In a report published today, it states that China's banks are strong enough to support isolated crises, but incapable of overcoming a crisis derived from overexposure to credit, housing bubbles, and the currency values.
The 126-page report is based on stress tests carried out on 17 Chinese banks, which cover 83% of the commercial banking system in the country. Prepared in June, it was released today with 29 recommendations to the Chinese authorities, fearing that reduced growth, and a housing bubble will lead to a credit crisis, similar to that afflicting the United States and which has caused the present global crisis.
The MSCI index of financial shares in China fell by 23% this year. Nevertheless, the Chinese Central Bank, says that "the report contains several points of view that are not sufficiently objective and complete."
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