China’s state banks close branches as coronavirus spreads
As the death toll rises, China’s big state lenders are being forced to shutter branches and Beijing has reacted by disbursing loans to afflicted companies – but the sector is also hit by slowing credit growth and a sharp rise in NPLs.
The People's Bank of China in Beijing
A provincial arm of one of China’s big-four state banks has taken a decision to close at least 10% of its branches, as coronavirus tightens its grip on Asia’s largest economy, Euromoney has learned.
The individual, a senior executive at the state-run lender, does not work in Wuhan, the capital of central Hubei province where the initial outbreak occurred, but in a well-developed part of the mainland far from its epicentre.
That fact and the decision to close hundreds of branches – the lender in question has thousands nationwide - suggest that a large number of branches in China are being quietly shuttered, and that Beijing is happy for now to step back from decision-making and give provincial officials a greater measure of rope.
“The aim may be to give branch managers more freedom to do what they want,” said a well-informed source.