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Effect of COVID-19 on non-performing loans in China

Authors: Kryzanowski LLiu JZhang J


Affiliations

1 John Molson School of Business at Concordia University, 1455 De Maisonneuve Blvd West, Montreal, QC, H3G 1M8 Canada.
2 School of Business and Economics, Moravian University, 1200 Main St, Bethlehem, PA 18018 USA.
3 Trent School of Business at Trent University, 1600 West Bank Drive, Peterborough, Ontario, K9L 0G2 Canada.

Description

We examine the resilience of Chinese banks during the COVID-19 pandemic by investigating non-performing loan (NPL) ratios. We find that despite the reduction in the growth rate of total bank lending, bank NPL ratios significantly increase during the COVID-19 crisis. Banks with high-quality capital are more effective in controlling their NPL ratios during the Crisis. Big Five banks, state-owned banks and domestic banks have lower NPL ratios than their counterparts during the Crisis.


Keywords: Bank ownershipCOVID-19Capital ratiosNPL, non-performing loanNon-performing loans


Links

PubMed: https://pubmed.ncbi.nlm.nih.gov/36164498/

DOI: 10.1016/j.frl.2022.103372