"Shares of China’s banks extended their slide to a two-year low amid
fears widespread 
mortgage non-payments would spark contagion within the
banking sector
even after the local banking and insurance regulator said it will
maintain continuity and stability of financing policies for the real
estate sector.
China Central Television said on its WeChat page that the regulator will
guide financial institutions to participate in risk disposals based on
market conditions, after researcher China Real Estate Information Corp.
reported that home buyers had stopped mortgage payments on at least 100
projects in more than 50 cities as of Wednesday, spurring concerns that
the quality of home loans is in rapid decline and could culminate in a
2007-like credit/housing bubble blow up.
The boycotts raise the risk of mortgage defaults, a new set of
troubles for banks that are already squeezed by exposure to ailing
property developers. Mortgages make up almost 20% of total bank loans
outstanding, amounting to about $5.8 trillion." ZeroHedge
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