Commercial banks'NPL rate dropped to 1.66% in September

16:45, October 22, 2009      

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Since the beginning of 2009, the non-performing loan (NPL) rate and the amount of remaining non-performing loans in the banking industry have both continued to drop. At the end of September, commercial banks' remaining non-performing loans stood at 504.5 billion yuan, down 55.8 billion yuan over the beginning of 2009. The non-performing loan rate stood at 1.66 percent, down 0.76 percentage points over the beginning of 2009, reporters learned from the fourth meeting of analyzing and announcing the economic and financial situations of 2009 held recently.

Liu Mingkang, chairman of the China Banking Regulatory Commission (CBRC), pointed out that although both the non-performing loan rate and the amount of remaining non-performing loans have dropped, potential risks from high credit growth are still accumulating.

Liu requires financial institutions in the banking industry to closely trace macro-economic and industrial restructuring trends, scientifically control credit issuance and strengthen the construction of the risk management system and mechanism.

Liu emphasized that in order to prevent risks it is necessary to; effectively strengthen the management and control of financing platforms and project loan risks, and firmly adhere to the policies of strictly forbidding the issuance of bundling loans; forbid the signing of large-amount credit cooperative contracts involving no specific projects and strictly limit loans issued to financing platforms with false investment reports and incomplete governing structure, internal control, risk management, capital management and utilization systems. Meanwhile, policies for buying second housing will be strictly and firmly implemented.

By People's Daily Online
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