2019-09-15

Pledge Stock Loan Risk Hasn't Evaporated

Caixin reports pledged stock risk is the same as it was in mid-2018. For background see: Stealth Risk From Hidden Pledged Loans and also The Bubble's Revenge: China's A-Share Market is Littered With Pledged Share Land Mines Buried During 2015 Mania, as well as some damage control covered here Shenzhen Bails Out A-Shares With Pledged Loans.

Of the 3668 companies listed in the A-share market, 3573 of them (or their major shareholders) have some level of pledged stock loans. Pledged loans are estimated at 8.3 percent of the total market valuation, down from a peak of 10 percent during the bear market last year.

财新:股票质押风险未消
Pledged loans are being paid off and the total outstanding is declining, but many companies are rolling over their pledged loans or obtaining new ones:

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