icbc had a 14% rise in the first quarter.ering the mandatory -- bank of141.2% china did the same thing. both in order to smooth out their earnings and get into positive territory. .cbc quarterly profits up 0.6% this is the fourth consecutive quarter that icbc has failed to reach even 1% earnings growth. is -- and i'mhing going to sound like a cynic -- the question over chinese bank balance sheets, who knew? offt: the issue is what is the balance sheet. a lot of the analysts do not want to a dress this because politically, it is dangerous and difficult to quantify. the two examples i have show the equity swap, that could bloom significantly. rishaad: they do not like this? guest: the banks have a profit motive. i respect a lot of people who work at the bank of china. they are the lifeblood of the system. they are the last recourse if the government is put cash in the economy. reporter: so how that is the problem? guest: my friends in china tell me it is more like 30 trillion yuan. that it is only 3 trillion at this point. the

that includes icbc, merchants loaned levels are around 1.7% of total assets in china.cern surrounding this plan. we had one chief executive of one of the state owned bank saying why do i went to turn bad debt into bad equity. guys -- rd from these rishaad: and fairly candid. >> it shows the level of concern. the china's construction think chairman did not one to turn bad debt into bad equity. there are questions about how the government is going to facilitate this process, whether or not they will allow the easing of credit, an injection of cash into the banks as well, and whether -- there are questions. in 1999, there was a real out of china's banks funded either tax power. -- taxpayer. yes, bit of skepticism. headlines -- some >> time to weep for bankers. the chairman of icbc, the world's largest bank by assets, in 2015pay cut by 70% to $85,000. rishaad: that's quite something. considering how much some of these guys are getting paid in other banks. of jamie dimon's pay package for last year. rishaad: i'm assuming without bonus. >> i think that's the full package for

icbc 156%. mention rising nonperforming loans, all affecting the profits. these banks may drop 3% in 2016 according to analysts. now, icbc, they're earnings starting to cool. this year, they are expected to record their fourth full-year earnings declined. a key factor for analysts trying to forecast what will happen with banks earnings out this week is whether the government loosens up this minimum requirement. rishaad: could the government cut this mandatory minimum? saids, right now sources akin february that policymakers had discussed it. the repertory commission will step in, and it would depend on when they want to cut it and by how much. the banks have already said that the minimum is 120% instead of 150% already for budgeting this year, but keep in mind that banks and nonperforming loans are at the highest and a decade right now, so fitch ratings has found -- sounded the alarm, relax that if you standards more when the banking system is flat, this could put into question the regulatory sy

here,s biggest ceo interesting salary cut. >> the chairman of icbc saw his 2015.ashed 72% in this isld's largest bank. his pay in 2015 was just under $85,000. that is around the amount the head of a department at a british school in london might get come and he is in charge of the world's largest bank. this comes as china is trying to curb compensation, balance out inequality issues. jamie dimon, ceo of j.p. morgan chase, earns $27 million in 2015, so 0.3% of that. angie: that is a tough job for that pay. that's the way it is in china. thank you for that. coming up next, we will take a look at the key economic crisisd ask about a debt in australia and whether it is overblown. two.t up" returns and ♪ >> it is 7:16 a.m. and hong kong , these of the stories making headlines. indian police considering murder charges against people arrested in connection with the collapsed ,verpass, 26 people killed officials say building regulations had been ignored. androadway was being built the project was years behind schedule. more data from the missing malaysia airlines plane. it is said to be from

icbc saying they did not realize several stock payment orders where from the bangladesh bank and wille money. a little-known japanese company is becoming the go-to guy when law enforcement agencies want to unlock smartphones. one of its decisions is said to work with the fbi to unlock an iphone link to the san bernardino killings. >> as a leading company in areas of forensics, we want to keep improving our technology to provide better services and skills to make the world safe and peaceful. division -- suncor sun corp. is expecting sales to grow annually. as for the next step, we are open to the idea of teaming up with companies that possessing unique technology and forensics. we will continue to search for appropriate partner. alibaba making his biggest overseas investment, $1 billion to take control of the southeast asia online retailer. a reporter is with me now. what about this deal? >> alibaba spending $1 billion, ating -- valuing the company $1.5 billion, the largest overseas acquisition from the company yet that wants to make more than half of its revenue overseas. this deal gi

the rest are chinese companies, icbc, alibaba.editor when he 5% premium to their hong kong equivalent, so there is a motivation to get in on the act over here rather than in shanghai. a lot of analyst saying that there are continued concerns that the renminbi will continue to push money over here and plays into the question of how they keep those capital flows rained in. rishaad: thanks a lot for that. tom mackenzie there. ,he pressure on the renminbi and one of the reasons is the debt problem in the country. it has been a recurring theme this year. asked how the economy will be affected by a debt pile growing daily. as long as debt continues to expand, they can generate growth until they reach some point at run out of debt capacity, and my guess is may be three-four years maximum. after that, it will be very difficult to generate growth, and that's when that will be a constraint on growth. >> how should policymakers in beijing be dealing with this? a lot of things at face by you look like a terrible idea. looked into how local go

the chinese companies are reporting that first-quarter net income is pretty much in line with what icbco came out with last year. e'll convert that to dollars so it makes more sense, but it seems pretty much in line. states, first-quarter total revenue on the screen, in line. there is was saying, no outcry of anything bad happening in china at the moment. up next, we talked germany and deutsche bank earnings. ♪ ♪ francine: welcome to "the pulse." life from bloomberg's european headquarters in london. i am francine lacqua. let's get to bloomberg's first word news with nejra cehic. nejra: bank of japan retained its -- maintained its record stimulus. japan's for consumer price index sunk by the most since april 2013. states, the federal reserve skipped the interest rate hike but left the door open for action in june. economic andlobal financial developments continue officialssks, instead will closely monitor the world's situation. facebook has soared in extended trading. business spend more to advertise. 52%. quarter revenue grew facebook is creating a new class of stocks that will help ce