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China is squeezing the wealth management product bubble
[BEIJING] China keeps tightening the screws in its campaign to reduce the mountain of debt.
The latest curbs landed late Wednesday, with the banking watchdog targeting wealth-management products that have more than tripled in the past four years amid low deposit rates and curbs on financing to overheated industries. Lenders will need to record all WMP sales starting Oct 20, after some "misled" consumers or sold them without regulators' permission.
While the consensus is that China still has a long way to go when it comes to actual deleveraging, it seems to have at least reined in the credit-growth beast, with WMPs plateauing since the crackdown was intensified in April.