Moody's raised outlook for China's banking system to stable - BBH

Analysts at BBH note that Moody's raised its outlook for China's banking system to stable from negative as it expressed confidence in its regulators to manage the risks emanating from the shadow banking sector and forecast that the growth of new bad loans will moderate.  

Key Quotes

“Recall Moody's cut the sovereign rating in May on its rising debt levels.  Today's announcement culminates an eight-month process whereby Moody's upgraded rating on medium-sized banks last October, and five large banks a few months ago.  Lenders with stable outlooks by Moody's account for nearly 90% the total assets of the Chinese banks that it rates.”