China's banking authority reiterates credit quality, pace control after lending spree

20:28, December 08, 2009      

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China's banking authorities vowed to step up efforts to improve credit quality, and keep credit expansion in reasonable pace after record lending, to echo government's call to rebalance economic growth pattern.

Chairman of the China Banking Regulatory Commission Liu Mingkang said bank loans should play a bigger role in economic restructuring as he put it the regulator would strictly control lending to industries that were energy-intensive, polluting and had overcapacity.

More credit support should go to promoting employment and industries of strategic importance, Zhou Xiaochuan, governor of the People's Bank of China told an insider meeting.

The central bank would continue to implement the moderately easy monetary policy in 2010 to ensure stable and relatively fast economic development, Zhou said.

The move was in response to the directives of the annual Central Economic Work Conference, which was concluded Monday agreeing to advance economic structure adjustment to lift the quality and efficiency of economic growth.

The central bank would exert more strength to beef up rural development and stimulate domestic demand, as well as enhance balance of payment, and hold down potential financial risks, Zhou said.

Chinese banks lent a record 8.92 trillion yuan (1.31 trillion U.S. dollars) in the first ten months, far exceeding the government's target of 5 trillion yuan for this entire year, prompting fears of bad loans and unprofitable investment.

Source:Xinhua
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