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Friday, March 23, 2012

''China Banks Said to Underestimate Local Government Risks''

From Business Week

"The China Banking Regulatory Commission told lenders last month that they had incorrectly placed about 1.8 trillion yuan ($286 billion) of loans to local government financing vehicles in the safest category of lending, the person said, declining to be named because the matter is private. The banks erred in calculations and underestimated risks when they decided the loans were fully covered by cash flows from the projects, the person said."

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