Chinese Banks make "crazy" loans to prop up China Eastern Airlines

Crazy Chinese bank lending continues apace with news that three of China’s government-controlled banks have just lent over US$6 billion to an airline that lost $2 billion last year.

China Eastern Airlines Co., Ltd., an airway company with total liabilities exceeding total assets by approximately US$1.6 last year, has won a credit line worth almost US$3 billion from the Bank of China.

According to a Trading Markets report, China Eastern Airlines has inked a similar agreement with the China Development Bank, winning a credit line of approximately US$4.3 billion. The airline company has also signed cooperation agreements with the China Construction Bank and other banks for credit lines of almost US$7 billion in total.

In exchange, China Eastern Airlines will provide full-spectrum airlines services and products to the banks.