Can Chinese banks expand their loan portfolio while maintaining loan quality and profitability post-global financial crisis?

PurposeThis study aims to investigate the relationships between loan growth, loan losses and net income after the 2008 global financial crisis. This study further conducts a comparative analysis by considering the period of COVID-19. Design/methodology/approachThis study uses panel data models such as one-step system GMM, random effects, fixed effects and OLS, with a data set of 131 Chinese commercial banks from 2009 to 2020. FindingsThe study finds no significant relationship between loan growth and future loan losses. However, after adjusting loan loss by net interest income (NII-adjusted loan loss), the study reveals that loan growth in the subsequent year decreases if NII-adjusted loan loss increases. The study also demonstrates the positive effect of loan growth on net income as newly expanded loans are funded at similar costs but offered at a lower rate compared with existing loans. During COVID-19, loan growth and net income were higher than in previous years. Originality/valueThe findings suggest that Chinese banks can increase lending to support the economy without sacrificing loan quality, emphasizing the importance of maintaining and enhancing credit policies and practices. Chinese banks should also continue to refine their pricing strategies for loans and deposits. The findings also imply that China's policy responses to the impact of COVID-19 could serve as lessons for future policy decisions.

Extreme development of dragon fruit agriculture with nighttime lighting in Southern Vietnam

Dragon fruit is widely grown in Southeast Asia and other tropical or subtropical regions. As a high-value cash crop ideal for exportation, dragon fruit cultivation has boomed during the past decade in southern Vietnam. Light supplementing during the winter months using artificial lighting sources is a widely adopted cultivation technique to boost productivity in the major dragon fruit planting regions of Vietnam. The application of electric lighting at night leads to a significant increase of nighttime light (NTL) observable by satellite sensors. The strong seasonality signal of NTL in dragon fruit cultivation enables identifying dragon fruit plantations using NTL images. We employed Visible Infrared Imaging Radiometer Suite (VIIRS) Day/Night Band (DNB) monthly nighttime imagery from 2012 to 2019 to extract the growing area of dragon fruit in Bình Thuan Province, the largest dragon fruit growing region of Vietnam. The Breakpoint for Additive Seasonal Trend (B-FAST) analysis was applied to calculate the seasonality of NTL inside the dragon fruit plantations and distinguish them from the background. The results indicated that the dragon fruit cultivation strongly increased after 2014 and reached a plateau after 2017. In recent years, dragon fruit cultivation has experienced a slight decrease due to market fluctuations. We applied a buffer analysis over the largest dragon fruit cultivation area in Bình Thuan to analyze the spatial trend of the expansion of dragon fruit planting. Our results suggest that the dragon fruit cultivation of Bình Thuan has expanded to cover most inter-hill plains, reaching a spatial extent capacity due to the topographical constraints, and thus has begun to encroach into the low-elevation foothill area. In the case of emergency lock-down orders in February 2020 during the COVID-19 pandemic, NTL used for dragon fruit cultivation changed heterogeneously in space and time, driven by market price and shipping limitations far away from the local restrictions. Under the dual rural-urban hot spot situation with strong and contemporary developments of both dragon fruit agriculture and the urban tourism industry, building structures were detected densely in the city and gradually dispersed well into the rural landscape in Bình Thuan. The outcomes of this study will be valuable for local policymakers to better understand of the available area for dragon fruit cultivation and achieve better-coordinated cultivation planning against future fluctuations of the global market while providing insights and new understanding into the dual hot-spot developments valuable for planning rural-urban change strategies. © Springer Nature Switzerland AG 2022. All rights reserved.