Regulator cautions banks on bad loans

China's top banking regulator yesterday warned banks of the potential risk in focusing lending only on certain industries, in an indication that bad loans could return to haunt Chinese banks in the next couple of years.

Far too many loans were extended to the infrastructure, energy, real estate and transportation sectors this year, Wang Huaqing, disciplinary commissioner of the China Banking Regulatory Commission, said at an international seminar on syndicated loans in Beijing yesterday.

Loans to large customers, which have credit lines of more than 50 million yuan, accounted for 66.9 percent of total advances at the nation's 19 biggest banks by the end of October, Wang said.