Homepage > News > Biz > 

Bank regulator: China's lenders have enough funds

2010-01-04 09:18 BJT

A top official of China's banking regulatory commission said in Beijing lately that the country's lenders have sufficient capital reserve, and he urged the lenders to extend credit to consumers and medium- and small-sized firms to bolster growth.

Liu Mingkang, the top banking industry regulator, urged the lenders to support rural residents and businesses, and the government's health care reform, and its efforts to save energy and curb pollution.

Liu also cautioned that there exists the possibility of "emerging structural bubbles" in the world's third-biggest economy, according to a report from the Bloomberg News.

A record 9.21 trillion yuan of new loans in the first 11 months of 2009 drove China's recovery -- at the risk of increasing non-performing loans and creating bubbles in stock and property markets, Chinese economists worried.

"Strong buffers," including capital, liquidity and provisioning requirements, have limited risks to the banking system of China, Liu said.

The regulator didn't say whether China will cap new loans in 2010, after Premier Wen Jiabao indicated on December 27 that last year's credit level was excessive.

China's policy makers are trying to secure an economic rebound while avoiding the stock and housing bubbles that plagued the U.S. this decade. Liu's warning on bubbles echoes cautions from Fan Gang, an academic adviser to the central bank, and Zhu Min, the deputy governor at the People's Bank of China, the central bank, said the Bloomberg News.

Editor: Xiong Qu | Source: People's Daily