That means finding ways to persuade banks to roll over loans (stopping, in particular, the sudden withdrawal of trade and short-term interbank credit lines).
The Jiangxi government has allotted 2 billion yuan to banks to roll over loans and required bank branches not to demand for payback for now.
FORBES: Chinese Solar Manufacturers Face Blowback As Trade War Escalates
German and French banks have already agreed in principle to roll over loans to Greece in order to give the country more time to repay its debts.
Until recently, the banks found it more expedient to roll over loans to insolvent borrowers rather than recognise losses, which would require them to increase their capital in order to meet regulatory requirements.
Banks are being pressured by the government to roll over existing loans and make new ones, and firms encouraged to extend credit and maintain business relations.
Second, a top Chinese banking regulator said recently that municipal governments, which have seen mounting debts, can roll over bank loans as long as projects are 60% complete.
Hiroshi Mitsuzuka, the Japanese finance minister, denies he has been arm-twisting the banks to get them to roll over their Thai loans.
Bankers have already had to roll over many of these loans, and, thanks to currency crises and economic collapses, a large proportion will probably end up unrecoverable.
These giant debts triggered the crash of 2008 because creditors refused to roll over short-term loans to banks, and caused the simultaneous recession because banks stopped lending, and have brought about our current economic malaise because our ability to spend and invest is hobbled by the imperative of repaying what we owe.
Most are just indebted Joes looking to consolidate debt or roll over Visa and MasterCard balances that are charging 14% into loans charging 11%.
应用推荐