China Regulator Said to Tell Banks Provisions for Bad Loans Are Inadequate

"The comments reflect persistent concerns that $1.7 trillion of lending to local governments may spur a wave of bad debts that could lead to the nation's third banking bailout in less than two decades. As much of 30 percent of the credit may sour, Standard & Poor's estimates, after a surge in lending that powered China's recovery from the global financial crisis."