Central bank chief Yi Gang told a news conference on March 3
that China has reduced the number of high-risk small- and
medium-sized financial institutions to more than 300 from over
600 over the past three years.
The government has unveiled plans to set up a new regulator
- the National Financial Regulatory Administration - which will
take over some regulatory responsibilities, including overseeing
financial holding companies and investor protection, from the
PBOC.
"The revamp signals a shift in the government’s priority
towards financial stability and de-risking the financial
exposure of local governments and financial institutions," ANZ
analysts said in a note.
"Local governments’ explicit debts have increased 16%
year-on-year over the past five years. Their implicit debts may
have reached 60 trillion yuan ($8.69 trillion), or half of
China’s GDP, according to our estimates," ANZ said.
($1 = 6.9020 Chinese yuan renminbi)
(Reporting by Kevin Yao and Ella Cao; Editing by Andrew Heavens
and Kim Coghill)
(Adds details, quotes)
BEIJING, March 15 (Reuters) - China will steadily reduce
the number of high-risk institutions to help fend off systemic
financial risks,its central bank said on Wednesday
Reforms of problematic small and mid-sized financial
institutions have made key progress and illegal financial
activities have been curbed, the People's Bank of China (PBOC)
said in a statement after its annual meeting on financial
stability.
The central bank will continue to follow the guidance of
"overall planning and coordination, differentiated policies and
precise bomb disposal", it said.
"It is necessary to strengthen the financial risk disposal
mechanism and capacity building, strengthen monitoring, early
warning and evaluation," the central bank said.
The central bank will improve legislation and the financial
stability guarantee fund system, and improve the role of deposit
insurance, the central bank added.
China's economy showed a gradual though uneven recovery in
the first two months, but statistics bureau spokesman Fu Linghui
told a briefing on Wednesday that corporate and personal balance
sheets damaged during the pandemic would need time for repair.
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