Loan rate hikes loom as risk management in focus

With net interest margins at a six-year low, banks change lending strategies

As policymakers remain intent on pushing financial deleveraging and curbing risk, the money market may face stricter regulation, higher financing costs; and lenders face a challenge to make profit as interest rate margins shrink and non-performing loan risks expand.

After Chinese lenders' net interest margins fell to a six-year low during a campaign to liberalize interest rates, banks are changing their lending strategies with a focus on quality instead of quantity, and attaching more importance to risk management, according to researchers.