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Signs of stress: Is Asia heading toward a debt crisis? McKinsey answers

Updated : August 27, 2019 12:54 PM IST

Global management consulting firm McKinsey & Co observes that the warning signs of a new crisis in Asia are "ominous".
According to McKinsey & Co, three fundamental signs of stress seems to be building throughout Asia. These include rising debt, dependence on banks and shadow-banking institutions, and fall in capital inflows.
In 1997, the Asian financial crisis was partly triggered when merchant banks in South Korea were caught in a severe credit squeeze. The country’s 30 merchant banks were heavily exposed to troubled companies, undercapitalized, and holding significant foreign-currency liabilities.
Signs of stress: Is Asia heading toward a debt crisis? McKinsey answers

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