China's banks could face mortgage losses of up to $350 billion in worst-case scenario.

'Bloomberg' quoted by the Executive Digest portal, reports a crisis of several suspended projects that has damaged the confidence of hundreds of thousands of home buyers in the country, which has caused a mortgage crisis in more than 90 cities, in addition to warnings of systemic risks.

S&P Global Ratings presented its worst-case scenario view, to which the publication had access, where it estimated that about 2.4 trillion yuan ($356 billion and about 345 billion euros), which corresponds to 6.4% of mortgages, are at risk. Deutsche Bank's view, meanwhile, is that at least 7% of home loans are at risk.

So far only 2.1 billion yuan of mortgages directly affected by the crisis have been reported.

"The banks are in the middle," Zhiwu Chen, a finance professor at the University of Hong Kong Business School, told the media outlet. "If they don't help the developers finish the projects, they will end up losing a lot more. If they do, of course it would make the government happy, but they add more to their exposure to delayed real estate projects."

Covid turmoil and high youth unemployment has been slowing economic growth, so China is putting financial and social stability at the top of its priorities by including a grace period on mortgage payments, as well as using a fund backed by the country's central bank to lend financial support to real estate developers.