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Industrial and Commercial Bank of China: Bad Debts Grew 72.5 Billion Yuan (US$11.83 billion)

Xinhua recently reported on the financial performance of the Industrial and Commercial Bank of China. Based on the first three quarters of 2014, even though its net profit is growing, the amount of outstanding bad debts has reached 766.9 billion yuan (US$125 billion), an increase of 72.5 billion yuan (US$11.83 billion) since the end of the second quarter. Its bad loan ratio is 1.16 percent, up by 0.09 percent from the second quarter. The report also stated that the bank’s overall risk compensation ability is stronger as its loan loss provision grew 69.8 billion yuan (US$11.39 billion); its provision coverage ratio, an indicator of how protected a bank is against future losses, is at 247.15 percent, down 15.74 percent from the second quarter, while its loan provision ratio, the ratio of loan loss provision to outstanding loans, is at 2.88 percent up 0.04 percent from the second quarter.

Source: Xinhua, November 17, 2014