Lenders grapple with bad loans

The first two Chinese banking giants to report earnings this week have two things in common: Zero profit growth and bad loans piling up at more than twice the pace of a year earlier.

Industrial & Commercial Bank of China Ltd posted a 31 percent increase in bad loans in the first half, while Agricultural Bank of China Ltd had a 28 percent jump, their stock exchange statements showed on Thursday.

At a press briefing in Beijing, ICBC President Yi Huiman indicated that the lender may have to abandon a target of keeping its nonperforming loan ratio at 1.45 percent this year, citing "severe" conditions. The level at the end of June was 1.4 percent.