The COVID-19 outbreak has cast a gloomy shadow over not only the formal financial industry of China, but also its shadow banking sector as well. Shadow banking basically refers to the unorganized credit-creating financial intermediaries that are not subject to regulatory oversight. Shadow banking problems In April, credit rating agency Fitch predicted that the Chinese ...
The COVID-19 outbreak has put many people under financial pressure. Since financial institutions have tightened lending, people are unable to get credit to make it through these difficult times. However, the shadow banking (informal lending) industry in China has seen remarkable growth in the first quarter of this year, according to a report by credit ...
Shadow banking basically refers to a group of financial intermediaries that facilitate credit creation but are not subject to regulatory oversight. These can include unlisted derivatives, hedge funds, unlisted instruments, etc. The global shadow banking sector is estimated to be worth US$52 trillion, with the U.S. accounting for around 29 percent or US$15 trillion. Since ...
China’s lending bubble has been a huge concern for economists for the past several years. A big chunk of the debt lies in the country’s shadow banking sector, which only increases the risk of China’s financial collapse. As reported by the Bank of International Settlements (BIS), the overall Chinese debt is currently at around 255 ...
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