Economy

Banking regulator warns on loans to local govts, realty sector

(Xinhua)
Updated: 2010-06-15 20:56

BEIJING - China's banking regulator warned Tuesday the nation's banking system faces major risks, the prominent being loans made to local governments and the real estate sector turning bad.

The China Banking Regulatory Commission (CBRC) urged banks to use scientific analysis in their lending in its 2009 annual report, published Tuesday on its website.

The report said some banks were lending large amounts to local government units with inadequate risk management, and that lending to local governmental vehicles entails significant potential risk.