Eartha
Member
- Joined
- Oct 8, 2009
- Member Type
- Student or Learner
- Native Language
- Chinese
- Home Country
- China
- Current Location
- China
Dear all,
How should I understand the underlined? Why "that is a source of concern"?
Thanks in advance.
Eartha
In contrast, smaller commercial banks have a much higher level of exposure. Bank of Nanjing and China Everbright Bank -- which in June delayed its Hong Kong IPO -- both have 20% of their loan book with local government financing vehicles. With the smaller banks' higher exposure only partially covered by higher capital, that is a source of concern.
How should I understand the underlined? Why "that is a source of concern"?
Thanks in advance.
Eartha
In contrast, smaller commercial banks have a much higher level of exposure. Bank of Nanjing and China Everbright Bank -- which in June delayed its Hong Kong IPO -- both have 20% of their loan book with local government financing vehicles. With the smaller banks' higher exposure only partially covered by higher capital, that is a source of concern.