China's fledging commercial banks are still hampered by weak lending practices that could provoke a new wave of bad loans if the booming economy were to slow, a senior analyst said. "The key question to ask is can the economy continue to grow very strongly," David Marshall, managing director of Fitch Ratings' Asia told AFP in an interview late Wednesday.
"The danger is that if the economy takes the downturn before risk management systems have been really well-entrenched then there is a risk of some problem loans starting to reappear." If China's struggling banks are truly to transform themselves into corporate winners then they will need more regulatory support from the government, Marshall said. China's banks are Asia's least profitable, according to Fitch.
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