Days of high profit growth are over

Overview: Ed Zhang

Here's why Chinese banks are reluctant to lend even though the central bank has cut both the interest rates and banks' reserve requirements: Their clients - mostly those on the corporate level - are besieged by more and more difficulties in the market and are less and less able to pay back their borrowings.

The latest data show that, since the beginning of the year, Chinese banks - led by the largest ones under State control - have seen the lowest profit growth rate in 12 years. There are already analysts forecasting that, based on the trend, the banks' growth could be even weaker in the second half of the year.