People’s Bank of China supports banks credit capacity
The agency seeks to improve the lending capacity of commercial banks to the real economy
The People’s Bank of China (BPC), the central bank of the Asian giant, has expressed the need to persevere in the structural adjustment of the economy and improve the lending capacity of commercial banks to the real economy.
In a meeting with representatives of the main Chinese banks, the governor of the BPC, Yi Gang, considered it necessary “to continue promoting the replacement of capital and improve the capacity of bank credit.”
At the meeting, held a day before the Chinese central bank predictably lowered the reference preferential interest rate for bank loans (LPR) on Wednesday, the central banker stressed the importance of moving forward with the countercyclical structural adjustments and support the credit to the real economy.
“We must persist in promoting structural adjustment based on current and future perspectives, and optimize the allocation of resources through reforms,” said Yi Gang.
The meeting was attended by the presidents of the ICBC banks, Chen Siqing; Agricultural Bank, Zhou Mubing; Construction Bank, Tian Guoli; Pudong Development Bank, Pan Weidong; Industrial Bank, Tao Yiping, and the vice president of CITIC Bank, Xie Zhibin.
Preliminary measures
The CPB reduced this Monday to 2.50% from 2.55% the interest applied in the reverse short-term liquidity auction held weekly, the first reduction in the price of money in this type of operations since October 2015.
Thus, the Chinese issuing institute injected 180,000 million yuan (23,197 million euros) with a seven-day maturity at an interest of 2.50%, compared to 2.55% last week.
On November 5, the institution had already lowered the cost of medium-term liquidity (MLF) for the first time since 2016 by lending 400,000 million yuan (51,550 million euros) for a year to 3.25%, five points basic less.
Source: dpa
