Rating firms say banks face Kaisa sequels in China

Hong Kong

RATING companies are warning of risks to Chinese lenders from a corruption campaign that's frozen real-estate projects and ensnared executives as the economy slows.

Moody's Investors Service predicted an increase in non-performing loans by property firms, after Kaisa Group Holdings almost missed a bond coupon payment while embroiled in an anti-graft investigation. Standard & Poor's warned of more than 10 developers with weak cash flows that have debt maturing in coming months. Fitch Ratings said the sudden resignation of the president of China Minsheng Banking Corp and investigation into a board member of Bank of Beijing Co underscored management and political risks facing China's banks.