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China’s banking sector faces difficult outlook this year

At least three of China's largest banks have declared that the country's banking industry is facing a more complicated and severe business environment this year. They cited the pandemic, global politics and domestic turmoil in the real estate industry as among the factors that will affect the banking industry's outlook. The banks include China Construction Bank, Bank of China, and Bank of Communications. China has been battling a resurgence in Covid-19 infections in some of its largest cities, which has led to partial and full-scale lockdowns which analysts say will be a drag on the economy. Nicholas Zhu, a banking analyst at Moody's, said that the main impact on banks will be rising loan delinquencies among service sectors. The banks' warnings about the difficult outlook came alongside full-year net profit figures from the three lenders that beat estimates.


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