Chinese Lenders Rein in Middle East Exposure as Iran Conflict Raises Risks

Chinese lenders Middle East exposure is being reduced as financial firms curb lending risks linked to the escalating Iran conflict, Bloomberg News reported citing people familiar with the matter.

One major Chinese bank has restricted drawdowns on a bilateral loan to an Abu Dhabi government-linked financial institution, while a mid-sized lender is seeking buyers for parts of syndicated loans to Middle Eastern borrowers.

Asian and Chinese banks extended more than USD15bn of loans to the Gulf last year, triple the previous year, with most funds flowing to Saudi Arabia and the United Arab Emirates, according to Bloomberg data, highlighting the scale of Chinese lenders Middle East exposure.