CCB's (China Construction Bank) annual report in 2013 showed its ratio of non-performing loans was 0.99%, unchanged from the previous year. On March 31, CCB said it would release subordinated debt worth 20 billion Yuan in the domestic market with the aim to increase tier 2 capitals. ANBOUND think tank scholars believe that it is precautionary action towards the fall of capital adequacy ratio by CCB. Since the default risk in Chinese financial market is intensifying, the bank’s non-performing assets will increase in 2014 and will be a challenge for the bank’s capital quality. CCB announced subordinated debt issuance at this moment has indicated that the bad debt is actually bigger than the non-performing loans ratio.