More on China considering a 1 trillion yuan injections of capital into banks

Earlier headline on this is here:

• Reports that China is considering injecting US$142bn of capital into top banks

A huge injection would be the first since the 2008 global financial crisis.

The capital injection would be into China’s biggest state banks, struggling with shrinking margins, faltering profits, rising bad loans. The broader economic picture weighing is of slowing growth and an ongoing mammoth property sector crisis. Four of China’s five largest lenders reported lower Q2 profit. The banks took the hint from central government to lower lending rates in an effort to trigger improved loan demand.

Funding for the injection will mainly come from the issuance of new
special sovereign bonds

This article was written by Eamonn Sheridan at www.forexlive.com.