China’s Banking System at Risk from Growing Dependence on Wholesale Funds

[kreslik.news]

Moody’s has issued a report revealing that the significantly faster pace of asset growth for Chinese banks, other than the country’s big four, suggests that much of the current asset growth in the Chinese banking system is supported by wholesale funds rather than deposits.

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Christine Kuo, a Moody’s Senior Vice President, said: “The increasing use of wholesale funds constitutes a systemic risk because it raises interconnectedness in the system and makes transmission of unexpected shocks more pronounced.”

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She added that with an increasing number of ... (read more)