Beijing has held private meetings with officials from the Asian Development Bank to secure crucial funding aimed at transforming the mainland's State Development Bank into an effective lending arm of the government. In a move interpreted as a further step towards hastening much needed economic reforms, surprise proposals were presented by the State Development Bank's newly appointed president Chen Yuan this week, calling for assistance in building an effective loans evaluations system. ADB director of infrastructure, energy and financial sectors Paul Dickie said Beijing had become anxious to put in place strong credit appraisal systems, and loan appeal committees, aimed at allowing better consideration of loan proposals. 'We are delighted [Mr Chen] asked, ' Mr Dickie said. 'He wants to turn it into a top-ranked project finance institution.' He said the ADB soon would send a mission to Beijing to evaluate the proposal and recommend the best way to build the loans system. Under Beijing's proposals, the aid agency would provide the necessary funding that would be used to commission a technical consultancy firm to build the system. The move serves to reinforce Beijing's intention to use the State Development Bank as one of its chief vehicles to set in place substantial expansion of physical infrastructure in the mainland as a means to offset any negative impact of the financial crisis in the rest of the region. Beijing's latest move to expand the role of the State Development Bank came as ADB officials yesterday signalled its own lending to the mainland this year was set to rocket, possibly reaching more than double the US$656 million in loans the ADB made to the mainland last year. Again, infrastructure projects were set to grab the lion's share of ADB loans, and Mr Dickie said there had been a sea of change in its dealings with Beijing, with the bank being able to secure much more easily than in the past important counterpart funding from the mainland for ADB sponsored projects. In stark contrast to last year, when ADB officials complained that its projects were being severely delayed by bureaucratic hold-ups in Beijing, there was now a much greater momentum behind launching into new projects. Mr Dickie said because of the new policy, aimed at implementing a $750 billion infrastructure programme within the next three years, mainland authorities had become more sensitive to the ADB's concerns. This year most of the agency's lending not directed to infrastructure projects will be devoted to strengthening the mainland's ailing financial sector. Mr Dickie claimed that the ADB's successful acquisition of a 3 per cent stake in China Everbright Bank in 1996 for $20 million, which was augmented by a $60 million loan, would be used to create a benchmark for the rest of the Chinese banking sector to model itself on. He said his aim was to make it into a best practice commercial bank and that a study conducted by international accountancy firm Price Waterhouse had identified how to most effectively overhaul the bank. The process is expected to take about four to five years, after which the ADB hopes to see the bank floated.