Key facts
- Traditional bank loans now account for less than 60% of China's total credit supply.
- Plunging interest rates are driving corporate and government borrowers into the bond market.
China's credit market is experiencing a significant transformation as declining interest rates encourage a shift from traditional bank loans to the bond market. For the first time in seven years, bank loans now constitute less than 60% of the total credit supply. This trend indicates a broader rewiring of how corporate and government entities are accessing financing within the Chinese economy.