Whether the Chinese economy can make a soft landing will be critical in ensuring the sound development of the global economy, and therefore, developments in China continue to warrant close attention. Besides the problem of inflation, it should be noted that there is a risk in China that part of the large-scale investment made through local government investment vehicles might become nonperforming.
Net income was depressed by the payment of a significant share of the Federal Deposit Insurance Corporation's (FDIC) special deposit insurance assessment and a continued high level of loan loss provisioning. Contributing significantly to better performance was the improvement of capital markets activities and increases in related fees and revenues.