BOC Stress test: House prices fall 30% non-performing loan rate Rose 1.2%

June 1 morning News, Bank of China Governor Lihui said today that BOC is currently carrying out price pressure test.　　Heavy pressure shows that if house prices fall by 30%, benchmark interest rates rise 1.08%, BOC's real estate loans will rise by 1.2%. Lihui in the Chinese Bank of China convertible bonds issued online promotion meeting to make the above remarks.　　He said Bank of China is opening a new review of one by one of local government financing platform loans, which is currently underway and is not expected to have a significant impact on the quality of the bank's assets. Lihui said BOC had carried out stress tests on all real estate loans, including mild pressure, moderate pressure and severe stress tests, as required by the CBRC.　　The bank's heavy pressure suggests that if house prices fall by 30% per cent and benchmark interest rates rise by 1.08%, the non-performing rate of BOC's real estate loans will rise by 1.2%. In addition, BOC also said that the current bank of China's foreign currency net exposure has been significantly reduced, if the renminbi appreciation, the bank's profits will not have a direct impact. On the contrary, changes in the renminbi exchange rate will increase the market demand for hedging products and services, which is the business advantage of the Chinese bank, the related intermediary business income is likely to increase. (Snow ting from Beijing)