{"id":42720,"date":"2025-09-25T14:18:09","date_gmt":"2025-09-25T14:18:09","guid":{"rendered":"https:\/\/www.newsbeep.com\/nz\/42720\/"},"modified":"2025-09-25T14:18:09","modified_gmt":"2025-09-25T14:18:09","slug":"chinas-banks-face-their-japanification-moment-sp-report-warns","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/nz\/42720\/","title":{"rendered":"China\u2019s banks face their \u2018Japanification moment\u2019, S&P report warns"},"content":{"rendered":"

China\u2019s banks are edging towards their \u201cJapanification<\/a> moment\u201d, as years of yielding margins to support the economy have \u201cleft the system thin on profitability and more exposed to credit shocks\u201d, according to a new report by S&P Global Ratings<\/a>.<\/p>\n

Japanification is characterised by a prolonged period of low growth and weak profitability, similar to the state of Japan’s economy after the country’s asset bubble burst in the early 1990s.<\/p>\n

While other banking systems had weathered ultra-low rates by diversifying revenue and cutting costs, \u201cChinese lenders may have fewer such options, leaving them more reliant on lowering credit losses to stay profitable\u201d, the report warned.<\/p>\n

For China\u2019s central bank<\/a>, \u201csafeguarding growth and social stability will take priority over bank profits\u201d, S&P credit analyst Ming Tan said in the report.<\/p>\n

To stimulate growth, Beijing has cut both the one-year and five-year prime loan rates to historic lows, which further squeezed mainland banks\u2019 profitability.<\/p>\n

At the same time, banks were directed to lend to weak borrowers and offer concessions, from the pandemic<\/a>-era fee reduction policy for small businesses to lower charges levied on funds and insurance products for consumers, according to the report.<\/p>\n","protected":false},"excerpt":{"rendered":"China\u2019s banks are edging towards their \u201cJapanification moment\u201d, as years of yielding margins to support the economy have…\n","protected":false},"author":2,"featured_media":42721,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[8180,2300,4177,902,138,38212,38215,607,38213,7708,219,3742,4431,38211,38209,38210,111,139,69,38214],"class_list":{"0":"post-42720","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-alibaba-group-holding","9":"tag-asia","10":"tag-beijing","11":"tag-bloomberg","12":"tag-business","13":"tag-ccb","14":"tag-cgs","15":"tag-china","16":"tag-chinese-banks","17":"tag-deepseek","18":"tag-economy","19":"tag-hang-seng-index","20":"tag-hong-kong","21":"tag-icbc","22":"tag-japanification","23":"tag-kgi-asia","24":"tag-new-zealand","25":"tag-newzealand","26":"tag-nz","27":"tag-ubs-global-research"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/42720","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=42720"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/42720\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/42721"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=42720"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=42720"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=42720"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}