Banks are highly liquid enterprises. Non-performing loans will increase the debt burden of banks, increase the ability of banks to absorb deposits, reduce operational efficiency, and lead to financial problems of banks.

The high rate of non-performing loans is the biggest harm to banks' ability to support the economy. In recent years, banks in China are extremely cautious about lending, because there are too many non-performing loans, which affect their lending capacity.

If the problem of non-performing loans is solved by issuing base currency, it will easily lead to inflation. If we take it lightly, a large number of non-performing loans will also induce social moral hazard. If we strengthen the efforts to deal with non-performing loans, it may lead to chain bankruptcy of enterprises and increase financial risks and social crises.