Chinese banks cut back on asset-backed bonds

Hong Kong

JUST as Premier Li Keqiang steps up efforts to revive China's loan-backed bond market to spur the economy, banks are baulking.

Chinese lenders have cut offerings of asset-backed securities (ABS) 45 per cent to 43.4 billion yuan (S$9.6 billion) this year, after a 15-fold jump in 2014, Bloomberg-compiled data show. They have reduced loans for four straight months, even as policymakers expanded the securitisation quota by 500 billion yuan to free up space on their balance sheets for fresh lending.