Chinese Banks Urged to Better Use Soaring Saving Deposits

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Last updated at: (Beijing Time) Friday, May 24, 2002

Chinese Banks Urged to Better Use Soaring Saving Deposits

China's central bank governor urged on Thursday the country's commercial banks to make full use of their rapidly growing savings deposits in fostering economic growth. He hopes every commercial bank strengthens its concept of loan marketing, formulates business plans, better fosters and selects small and medium-sized corporate clients and improves efficiency in their use of funds.

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China's central bank governor urged on Thursday the country's commercial banks to make full use of their rapidly growing savings deposits in fostering economic growth.

Speaking at the Ninth General Assembly of the World Savings Banks Institute, Dai Xianglong, governor of the People's Bank of China, said that private bank savings had soared to 8.67 trillion yuan (1.05 trillion U.S. dollars) by the end of April, 53.6 percent of total deposits at all the financial institutions.

"I hope every commercial bank strengthens its concept of loan marketing, formulates business plans, better fosters and selects small and medium-sized corporate clients and improves efficiency in their use of funds," he said.

Unprecedented challenges ahead

The governor said that China would gradually optimize the local currency's exchange rate system under the precondition of a "basically stable" renminbi and gradually loosen capital controls and promote the currency's full convertibility as its foreign exchange reserves grow.

He said that China's foreign exchange reserves hit 233.8 billion U.S. dollars by the end of April, 21.6 billion U.S. dollars more than at the start of the year.

He warned that the domestic commercial banks are facing "unprecedented challenges" with the deepening development of capital markets, which erodes their traditional business, while the fund industry grows to be a powerful rival and information technologies challenge the way they operate.

The Industrial and Commercial Bank of China is the world's biggest savings bank with more than 2 trillion yuan (240 billion U.S. dollars) in saving deposits.

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