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A local rides his vehicle past a branch of Agricultural Bank of China in Xiangfan, Hubei province, October 27, 2010. Agricultural Bank of China Ltd, the country's No.3 lender, said its net interest margin may hit a bottom in the first half of the year. The bank's net interest margin will be slightly lower this year, it said on Tuesday.
A local rides his vehicle past a branch of Agricultural Bank of China in Xiangfan, Hubei province, October 27, 2010. Agricultural Bank of China Ltd, the country's No.3 lender, said its net interest margin may hit a bottom in the first half of the year. The bank's net interest margin will be slightly lower this year, it said on Tuesday.
(Stringer/Reuters)

BREAKINGVIEWS

Will bad loans from China’s east coast turn into a tsunami?

Reuters Breakingviews delivers agenda-setting financial insight. Its global correspondents react to stories as they develop, delivering sharp and provocative commentary on big financial news as it breaks.

Credit alarm bells are ringing in China’s east. Earnings from three of the country’s top four lenders show that while the national ratio of bad debts to loans is still falling, stress is building in coastal regions. Problems in an area rich in private sector businesses and manufacturing could be a national concern.