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Bank of China consumer loans surge in 1999

BEIJING: Outstanding consumer loans at the Bank of China had soared 134.47 percent to 18.237 billion yuan ($2.2 billion) by the end of last year from 10.45 billion yuan a year earlier, the Financial news reported on Monday.

Consumer loans of the bank, one of China's big four state-owned commercial banks, include housing loans, car loans, education loans, holiday travel loans as well as loans for home decoration and durable goods, the official newspaper said.

The Bank of China launched mortgages for home buyers in 1998 as its first consumer loan, it said. The state has been trying to encourage credit consumption to fight stubborn deflation.

Bankers say there has been only lukewarm demand for the loans as avid savers complain of the red tape they have to go through to get them as well as the high prices of cars and houses.

Some banks are also loath to expand the personal loan business, concerned about the risk of lending to people in a country where few have credit histories, bankers say.

Consumer loans make up less than five percent of the loan portfolios of major state-owned commercial banks, which have long acted as cashiers to loss-making state companies.-Reuters