Market-driven consolidation likely in China banking sector: S&P

HONG KONG – As China's economic growth decelerates and some industry sectors face growing oversupply issues, the risks from China's recent credit boom appear to be rising to the surface for the country's banks, according to ratings agency Standard & Poor's, which has examined the credit profiles of China's top 50 banks by asset size. "Rising credit costs, compressing interest margins, and growing pressures on non-interest incomes are likely to constitute a triple-hit to bank earnings," said S&P Senior Director, Qiang Liao. "In particular, we think it is highly likely that the banks could incur substantially higher credit losses in coming years."