Chinese Banks Sell Record $4.6 Billion in Mortgage-Backed Securities as Housing Crisis Deepens
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Chinese banks are packaging more non-performing loans into asset-backed securities as the property crisis worsens.
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ABS bond sales jumped 88% in the first 10 months of 2022 to $4.6 billion, a record high.
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Regulators are pushing banks to remove bad loans from their books, driving the ABS issuance.
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Mortgage defaults remain low but housing loans make up half of recent ABS products.
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Demand comes largely from state entities, as authorities encourage NPL disposals.