Rising costs, competition bedevil midsized China banks

Shanghai

SQUEEZED between cut-throat competition from online financing firms and rising funding costs, China's midsize banks are falling out of investors' favour as they increasingly lag behind the country's top five lenders.

While margins generated from lending have remained broadly stable at the larger banks, they have shrunk considerably for the second-tier lenders such as China Everbright Bank and China Merchants Bank over the past six months, a Reuters data analysis shows.