Goldman Slashes Stock Ratings of Big Chinese Banks

The $4.69 trillion of local government debt held by 12 state-owned and private banks threatens earnings and dividends, the Wall Street bank finds

Goldman Sachs estimates that 12 large publicly traded Chinese banks hold a total of 34 trillion yuan ($4.69 trillion) of local government debt.

Goldman Sachs downgraded shares of several top Chinese lenders, citing the risk of losses and saying their exposure to local government debt threatens to weaken earnings growth and put capital accumulation and dividends under pressure.