# Prof. Robert Engle on financial risk in China

1 Faculty News December 19, 2013 ![ABC Online logo](/sites/default/files/styles/246w/public/assets/images/con_042219.jpg?itok=fA6yLEvN)>

Excerpt from [ABC.net](http://www.abc.net.au/news/2013-12-19/nobel-winning-economist-warns-of-chinese-financial/5168196?section=business) -- "So, what is happening in China is that the banks are taking a lot of risk; they've made loans to municipal governments and state-owned enterprises which are, by all reports, largely non-performing, many of which have gone into feeding a real estate bubble and, what is most likely to happen in China is that there will be big reforms and the Chinese government will pump a lot of money into the banks to clean up their balance sheet."

[Read more](http://www.abc.net.au/news/2013-12-19/nobel-winning-economist-warns-of-chinese-financial/5168196?section=business)