Banking watchdog reaffirms support to small firms

Chinese banking regulator reiterated its commitment on Jan 13 to controlling non-performing loan ratio of commercial banks to ensure the integrity of these institutions as secured and efficient financial intermediaries serving the public needs.
 

China Banking Regulatory Commission (CBRC) said in a statement released after its executive meeting to review the work in 2008 and map out the plan for 2009 that it would provide more loans to finance mergers and acquisitions between large enterprises to meet projected increase in demand in 2009.
 

Qualified small and medium-sized banks are allowed the flexibility to exercise prudent judgment when there is a need to exceed the regulated deposit and loan ratio to expand their lending to small enterprises that require financial aides to weather the business downturn.
 

The banking watchdog has requested banks to keep the increase of loans to small firms at a rate that is comparable to that to large enterprises.
 

The regulator has also singled out the importance of increasing credit support to agricultural production by expanding the scope and scale of banks' financial services in rural areas. In addition, the commission has advocated innovations in financial products to encourage domestic consumption.