Bloomberg News

ICBC Cited for $832 Million of 2010 Non-Compliant Loans

June 01, 2012

Industrial & Commercial Bank of China Ltd. was found to have provided 5.3 billion yuan ($832 million) of non-compliant loans in 2010, accounting for less than 1 percent of all credit it extended that year.

The loans that violated rules were given to projects that failed to meet procedural and capital requirements as well as to local government financing vehicles, the National Audit Office said on its website today. ICBC “reasonably” controlled the size of its loan disbursement, the auditor said.

Chinese banks lent a record $2.8 trillion in 2009 and 2010 as part of the government’s economic stimulus measures to combat the effects of the global financial crisis. The scale of the lending has spurred concerns that the nation’s banks will be saddled by an increasing number of bad loans.

The 5.3 billion yuan of non-compliant loans in 2010 were part of 9.5 billion yuan in total lending cited in the audit office’s report as having violated rules. The auditor didn’t say when the remaining loans were made.

To contact Bloomberg News staff for this story: Aipeng Soo in Beijing at asoo4@bloomberg.net

To contact the editor responsible for this story: Chitra Somayaji at csomayaji@bloomberg.net


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