The China Banking Regulatory Commission (CBRC) has urged commercial lenders to be more vigilant when providing loans after a spate of heavily indebted companies found themselves in hot water in the last month. The CBRC issued new guidelines specifically highlighting 10 types of credit risk the banks should pay more attention to, including risks arising from bond investment, inter-bank lending, wealth-management business, property, and internet financing. “Banks should effectively verify clients with high risks, and prevent granting credit to zombie companies or shell companies,” the guidelines say. They also advise lenders to investigate loans which have been overdue for 90 days or more, in order to strengthen risk control and maintain asset quality. China’s banks extended a record CNY12.65 trillion of loans in 2016, despite worries about the dangers of prolonged debt-fueled stimulus. The country’s corporate debt is estimated at 175% of GDP, among the highest in emerging economies. It has climbed from less than 100% of GDP at the end of 2008, according to the Paris-based Organization for Economic Cooperation and Development (OECD) in mid March. In their annual reports issued in the past month, Chinese banks have cited deteriorating credit quality and high corporate debt leverage as a primary challenge for the industry. Bad loans written off and transferred out by the top five banks rose by 16% to CNY309.6 billion from the previous year, the South China Morning Post reports.