Healthy or Unhealthy? That is a Problem -- Unveiling the Myth of Chinese Banks' Success
Journal of International Banking Law and Regulation, Issue 2, (2013)
8 Pages Posted: 4 Sep 2013
Date Written: September 4, 2013
Abstract
Chinese banks appear to be freed from the recent financial crisis. While their counterparts in Western countries are suffering from the financial crisis, Chinese banks have been able to cement their positions in the market place. Nevertheless, a deep look at the Chinese banks’ lending practices indicates that Chinese banks are also encountering some critical problems such as policy-oriented lending and lending irregularities, which have resulted in local governments’ debt crisis. This article not only looks into these problems by reference to the path dependency theory but also some related regulatory and policy initiatives.
Keywords: Financial crisis, banking sector in China
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