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The China's overall financial...........>

CHINA PRESS
CHINA PRESS: The China's overall financial leverage ratio remained relatively
stable in the second quarter, with non-financial institutions' ratio falling,
that of local governments basically unchanged, and that of the household sector
rising, the China Securities Journal reported Thursday. The overall leverage
ratio edged up 0.7 percentage point in the second quarter to 238.2% from 237.5%
at the end of June, the report said. Continued strong demand for housing credit
was the main contributor to the rising ratio in the household sector, with
short-term consumption loans flooding into the property market after banks
restricted mortgage lending, the report noted. The leverage ratio of local
governments will increase in the second half of the year as the gap between
fiscal revenue and spending widens, the newspaper said. The issuance of local
government bonds will rise since borrowing via illegal fund-raising vehicles is
now being strictly regulated, the report said. Still, it remains a concern that
some local governments may continue to provide guarantees to public-private
partnership projects, the report warned. (China Securities Journal)

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