China's extraordinary lending boom already is raising the specter of another nonperforming loan crisis like the 1990s.

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The China Banking Regulatory Commission announced that the nonperforming loan ratio for all banks was 1.14% at the end of last year, but that number hides more than it reveals.

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Central government regulators have, once again, abandoned the goal of improving nonperforming loan ratios in another all-out bid to manufacture growth, so they need money to flow into the banks to support new lending.

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For one thing, nonperforming loan ratios are declining.

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But some are destined for foreclosure and will need to be foreclosed in the coming years, not to mention that some going into the loan modification bucket or nonperforming loan sale bucket will end up as foreclosures eventually.

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"There's clearly been a rapid appreciation in residential land values, but at the same time you've got to keep reminding yourself that you're buying a nonperforming loan, " says Curt Bailey, president of Related Midwest, a unit of Stephen Ross's Related Cos. that has expressed interest in the site.

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No one knows the extent of the problems in these financial institutions, but the central government's statistics showing single-digit nonperforming-loan ratios have a too-good-to-be-true quality to them.

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