12:02 - 26.09.2024

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September 26, Fineko/abc.az. China is considering a possibility to inject up to 1 trillion yuans ($142 billion) into its largest state-owned banks to increase its ability to support the struggling economy, ABC.AZ reports with reference to sources.

Most of the financing will come from the issuance of new special sovereign bonds, the details of the decision may be changed.

"Such a step will be the first since the global financial crisis of 2008, when Beijing is pouring capital into its large banks,"  a source says.

China's desire to replenish the capital of its banks is associated with the announcement of a reduction in mortgage rates and key interest rates. In recent years, lenders such as Industrial & Commercial Bank of China and Bank of China have been attracted to support the economy. Today, China is struggling with record low profitability, falling profits and rising debts.