Lenders to abide by credit codes: fi­nan­cial reg­u­la­tor

Global Times US Edition - - BIZUPDATE -

China will not set spe­cific tar­gets for in­di­vid­ual banks on how many loans should be given to pri­vate firms, and banks’ credit assess­ment stan­dards will not be com­pro­mised, sta­te­owned China Se­cu­ri­ties Jour­nal said on Mon­day, cit­ing reg­u­la­tory sources.

The ap­par­ent at­tempt to calm mar­ket jit­ters came after in­vestors wor­ried that com­ments made by the head of the bank­ing and in­sur­ance reg­u­la­tor last week might see the fi­nan­cial sec­tor take on more riskier loans.

Guo Shuqing, chair­man of the China Bank­ing and In­sur­ance Regu- la­tory Com­mis­sion (CBIRC), said on Thurs­day that at least a third of big banks’ new loans to com­pa­nies should be to pri­vate firms, while at least two-thirds of small and medium-sized banks’ new loans to com­pa­nies should be to pri­vate busi­nesses.

Chi­nese stocks, which were dragged lower by fi­nan­cials on Fri­day, ad­vanced in early trade on Mon­day.

“The tar­gets are not ‘hard’ in­di­ca­tors for each bank,” the China Se­cu­ri­ties Jour­nal said, cit­ing un­named sources. “The reg­u­la­tory au­thor­i­ties will not pro­pose spe­cific tar­gets for a sin­gle bank.”

Guo also said on Fri­day on the reg­u­la­tor’s web­site that the fi­nan­cial in­sti­tu­tions can­not ap­ply a ‘one-siz­e­fits-all’ ap­proach, adding that they have to treat the dif­fi­cul­ties fac­ing pri­vate firms ob­jec­tively.

China’s eco­nomic growth cooled to its weak­est quar­terly pace since the global fi­nan­cial cri­sis as a year-long cam­paign to tackle debt risks and the trade war with the United States have be­gun to bite.

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