Rising household debt threatens Asian banks, S&P reports
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Rising household debt in East Asia could undermine the credit worthiness of some of the region's banks, ratings agency Standard and Poor said Tuesday.
The warning was made in an S&P report evaluating the asset quality of banks in Malaysia, Thailand, Singapore, Korea, Hong Kong, and China.
"Rising household debt fuelled by rapid loan growth and easy monetary conditions could weaken the credit quality of banks in Asia," said S&P's credit analyst Ivan Tan.
"Potential asset bubbles and imbalances are building up in some countries, and could put the banks at risk." Malaysia, Thailand, Singapore, and Korea have the highest household debt in Asia, according to the report, with banks in Malaysia and Thailand deemed the most vulnerable to non-performing loans in the household segment.//DPA
