17 January 2019

Chinese credit crackdown felt overseas, FT says

China Development Bank has begun asking some foreign clients to postpone drawing down previously committed credit lines, signaling a tighter credit environment amid the government’s broader efforts to crack down on shadow banking, the Financial Times reported Monday, citing a source with knowledge of the matter. Two Indian companies – an infrastructure developer and a shipping group – were among those told to wait before accessing promised credit lines, the source was quoted as saying. Meanwhile, CDB and Export-Import Bank of China (EIBC) have shown greater willingness to put international borrowers into bankruptcy and sell their assets in an attempt to recover value from failed loans, the report said. CDB and EIBC have become pillars of international development finance, together lending more to governments and companies in developing countries than the World Bank.

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