China Closes Over 670 Banks in 2025 Amid Economic Slowdown

More than 670 banking institutions ceased operations across China during 2025, resulting in a reduction of the country’s total bank count by approximately one-quarter. The Financial Times reported these figures, citing data from China’s National Financial Regulatory Administration.

Rural Lenders Face Tighter Oversight

The closure of these entities represents a record high for the sector and was primarily aimed at strengthening regulatory control over smaller lending institutions. This consolidation effort coincides with a broader deceleration in economic growth within the nation.

The vast majority of the shuttered banks were located in rural areas. Restructuring efforts within the rural banking system occurred alongside shifts in China’s general economic conditions, most notably the halt in rapid expansion within the real estate market.

Evergrande Collapse Marks Historic Liquidation

Chinese property developer Evergrande Group collapsed after its liabilities exceeded $300 billion, making it the largest debt burden among any real estate development company globally. The firm defaulted on payments in late 2021.

In January 2024, a Hong Kong court issued an order to liquidate the company. Founder Hui Ka Yan received a life prison sentence in August 2026 following convictions on financial charges.