China at Risk of Banking Crisis in BIS's Early Warning Signal

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China, Canada and Hong Kong are among the economies most at risk of a banking crisis, according to early warning indicators compiled by the Bank for International Settlements, Bloomberg News reported. Canada -- whose economy grew last year at the fastest pace since 2011 -- was flagged thanks to its households’ maxed-out credit cards and high debt levels in the wider economy. These same issues also afflict China and Hong Kong, according to the study. The study offered some surprising results: for example, Italy wasn’t shown as being at risk, despite its struggles with a slow-growing economy and banks that are mired in bad debts. While China was flagged, a key warning indicator known as the credit-to-gross domestic product “gap” showed an improvement, said the BIS, known as the central bank for central banks. This may suggest the government is making progress in its push to reduce financial-sector risk. Read more.