China Regional Banks Exposed to Bond Reversal as PBOC Sales Loom

From bnnbloomberg.ca

China’s regional lenders are facing growing risks in the nation’s $4.3 trillion sovereign debt market after an unprecedented bond rally this year prompted a slew of warnings from the central bank. The lenders, some with over 50% of their assets in bonds, are bracing for potential sales by the People’s Bank of China, which is seeking to control risks and cool the market. The banks are divided over whether to keep chasing the rally or trim their positions, according to interviews with more than a dozen bankers who requested anonymity discussing a private matter. Regional banks have been the most aggressive buyers ... (full story)