首页|Up To 50 percent Shanghai Bourse Copper Stks Under Financing -Analyst
Up To 50 percent Shanghai Bourse Copper Stks Under Financing -Analyst
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NSTL
About 20 percent-50 percent of copper stocks in the Shanghai Futures Exchange warehouses aren't available to buyers because they are used as collateral for bank loans, senior economist Zhou Feng of Minmetals Information Center said. "It's a common practice here. When people are short of money and need bank loans, it's easy for them to import copper, open a letter of credit" and later use the metal as collateral, Zhou said. It's not easy to obtain bank loans otherwise, Zhou added. Borrowers would then use the funds to invest in other financial markets, such as buying properties or shares, he added. Copper became a popular tool to obtain bank loans in China because of its high trading liquidity. With China's high demand for copper, investors can sell the metal easily once they no longer need the metal as collateral, Zhou said.
NSTL
