In China, a new report from PwC, indicates banks are dealing with a surge in bad loans as a result of slowing economic growth. 

Asset quality is getting worse and the average overdue loan period is increasing, according to PwC China Banking and Capital Markets leader Jimmy Leung, who noted there is increasing pressure on overdue loans to be downgraded to the non-performing loan category. 

As the economy slows, the combined loan balance at China's 12 biggest banks are grew 11.49% in 2014 to $8.44 trillion, according to PwC. But non-performing loans jumped at a much higher rate of 38.23%. Overdue loans - not yet classified as non-performing - jumped 112.65%.

Leung, in the report, said, "There are a variety of indications that credit risk exposure is accelerating. The banks need to get to grips with credit asset quality pressures.”  

China's economy expanded at its slowest pace in 24 years in 2014. The economy continued to lose momentum in the first quarter of this year.

Slowing growth has seen the quality of loans deteriorate.  The People's Bank of China (PBoC) has tried to help including last week cutting the reserve requirement ratio (RRR) for banks by 100 basis points to stimulate lending. It was the second cut in two months.  

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