CHIR - Idiosyncratic Risk In China Real Estate: What Does It Mean For The Property Market And Banks?
- Over the past few months, we have seen examples of this idiosyncratic risk emerge, with Evergrande being the most notable.
- Given recent developments, we have updated our outlook for China real estate and its potential impact on the banking sector.
- While further deterioration across property developers, if not contained, would surely give rise to increased NPLs and weigh negatively on banks’ earnings, we think it would not likely be a systemic issue but more of a profitability hit.
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Idiosyncratic Risk In China Real Estate: What Does It Mean For The Property Market And Banks?