SHENZHEN authorities have pledged to resolve problems in the financial sector by establishing a new monetary system, allowing foreign banks to take part in yuan-related business.
Newly appointed vice-governor of the People's Bank of China Zhu Xiaohua and Shenzhen officials admitted at a meeting that discipline in the financial sector was lax.
The meeting was held amid reports that Vice-Premier Zhu Rongji was the Pearl River delta area to inspect the implementation of the Government's macro-economic control policies.
Yesterday, both an assistant to the Shenzhen mayor and the Shenzhen government's propaganda chief said they had no knowledge of Mr Zhu's arrival.
The governor of the Shenzhen branch of the People's Bank of China, Wang Xiyi said there were breaches of rules in mutual bank borrowing.
Some financial institutions set up their own companies to engage in unrelated businesses, he said.
It was revealed that among the new loans granted this year, more than 40 per cent went to the real estate sector, resulting in a shortage of funds for infrastructure projects.