EFTA01364937.pdf

Figure 14' China's overall debt level is rising !Figure 15-. China's corporate debt has been rising faster dramatically, particularly corporate debt. which stands at than that of the US over the past few years 150% of GOP 250% 160% 140% 200% 110% ISO% 100% HMS 100% 60% 50% 40% 20% CISS Jaren Jene.19 1 10 Am II .6042 Jaui3 0% MCcposorate debt tedetteteic bans 2000 2009 2010 1011 2011 2013 nlvtal Gun vain 1.04V 90.4 M4-414Ctelt debt as a % cd GUI' UN time Saar Zweargewbret. (EC MessSwam. lee afthlee Ka 404 itOgiawip Meer(' Figure 18: Rising risk of loss-making enterprises and Figure i9: Industrial profitability is at risk of declining as possible defau€t ii credit growth slows further IP slows 100% 20% 35% YbY% 3MMA YoY% 18%- • 3MMA 80% 30% 16% - Id% - 25% 60% 12% 20% 40% 10% - 15% 20% 6% 10% 4% - 0% 5% 2% - 20% 0% 0% ..lareettt Jan60 An.I* Jan.I1 jao.12 Jan13 3 40% stb of Loss Listing Enterptse %M total Lai9e Jan-06 Jan Jan-10 Jan-12 MMerbun ipakisti440413, ems estustoal Fre:op-no Noll ak401. Anew %kr Icons gtowth IOH61 sera. Damao1st CPC Aresto Awe's, 3isma &no% — CDC ettorav finew•IP r Figure 16: SOEs' RoA has not picked up, despite rising debt level r Figure 17: In fact, net profit margin has been low despite easy funding compared with private enterprises in China 60% % 9.0% 1 8.0% I 5 0% 7.0% 4 0% CO 3.0% • SO% 4 4.0%i 2.0% 3.0% 1 1.0% • 2.0% 1 1.0%a of, 00% i annualised 2004 20* 20:0 2007 2008 2009 2010 2011 2012 2013 0.02. t Whin. 50t-,: nintlni On ilSin Mont aaacrt• Rare CMC Sarthew snows 1.11 Caws Akar. &rot 1,,-" IP CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0055493 CONFIDENTIAL SDNY_GM_00201677 EFTA01364937