China still needs to concentrate on debt problems. Illustration: iStock

China’s banking regulator is tightening supervision over the quality of bank assets and is becoming increasingly intolerant with non-performing loans, reported, quoting sources from several banks.

An insider told that since last year, during every meeting, the regulatory authority has required banks to accurately report the situation of non-performing loans.

The regulator is paying special attention to loans where payment of interest and principal are past due by 90 days or more, and categorized as a type of non-performing loan, which is considered to be an upgrade of the previous supervision.

In recent years, with the continued decline in asset quality, banks’ overdue loans have increased.

By the end of 2017, A-share listed banks’ non-performing loans hit 1.23 trillion yuan (US$190 billion), while overdue loans for more than three months have reached 1.05 trillion yuan (US$160 billion).

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