Non-performing loans at mainland banks have risen for a fourth consecutive quarter, and analysts say economic uncertainty will continue to put pressure on the asset quality of lenders.
Bad loans in the third quarter rose 22.4 billion yuan (HK$27.7 billion), or 4.9 per cent, to 478.8 billion yuan from the second quarter, the China Banking Regulatory Commission (CBRC) said yesterday.
It is the longest streak of asset deterioration since 2004, when the data first became available.
Non-performing loans will continue to rise this quarter and until early next year despite recent green shoots in the economy, said She Minhua, an analyst at Zhong De Securities.
"The impact on banks' asset quality would lag behind the weakness in the economy for about three quarters," he said.
Non-performing loans increased at all types of banks in the third quarter. Large commercial banks' bad loans rose 1.7 per cent from the second quarter, and those at city commercial banks went up by 5.2 per cent.