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China lowers key parameter to rein in cross-border financing

(Xinhua)    15:03, December 12, 2020

BEIJING, Dec. 11 (Xinhua) -- China on Friday lowered a key parameter in its macro-prudential management to rein in the ability of its financial companies to borrow foreign debt.

The macro-prudential adjustment parameter, a multiplier that decides the upper limit of outstanding cross-border financing an institution can have, has been revised to 1, down from 1.25 previously, according to a joint statement issued by the People's Bank of China and the State Administration of Foreign Exchange.

The downward revision aims to further improve the macro-prudential management of cross-border financing and guide financial institutions to adjust their foreign debt structure, the statement said.

Financial institutions should stick to a "risk-neutral" philosophy and better serve social and economic development, it added.

(For the latest China news, Please follow People's Daily on Twitter and Facebook)(Web editor: Zhang Wenjie, Bianji)

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