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China Not ‘Dumb’ Enough for Lehman Moment, StanChart CEO Says

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·1 min read
China Not ‘Dumb’ Enough for Lehman Moment, StanChart CEO Says
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(Bloomberg) -- The Chinese government won’t allow the turbulence surrounding stricken property developer China Evergrande Group to turn into a systemic crisis, the chief executive officer of Standard Chartered Plc said.

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The lender, which has a heavy focus on Asia, has no “concerning exposures to the property sector,” CEO Bill Winters said in an interview with Bloomberg Television recorded in London on Tuesday.

“This idea that this was something of a Lehman moment for China: I don’t think China’s frankly that dumb,” he said.

China, a key country for the bank, is still on course to grow at roughly 5%, Winters said, while the recent crackdown on technology companies will have little impact on the banking sector. “These aren’t random attacks on random industries, this was saying ‘we want our youth employed and engaged,” he said.

The broader global economy, meanwhile, is facing a bumpy recovery from the Covid-19 pandemic, Winters said.

“I’m not desperately concerned about the economy but I think it’s going to be a little bit harder,” he said. The removal of pandemic-era support measures will take away some momentum, he said.

“I think the inflationary pressures are transitory, but I also see structural wage pressures that are building up on the back of a reasonably strong economy and other dislocations that will not be easily resolved,” he said.

Winters was sanguine about the long-term direction of the markets, which are “extremely interest-rate sensitive right now” but still underpinned by strong fundamental growth.

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