Beijing to keep tabs on local fundraising

Beijing will release regional financing figures from this year to better monitor fundraising activities as lower-level governments unveil ambitious plans to increase investment.

The People's Bank of China will start publishing regional data of total social financing (TSF), an indicator of liquidity in the real economy, from this year, according to Pan Gongsheng, a deputy governor of the central bank.

TSF includes bank lending, bond and equity issues, trust loans and entrusted loans. It rose 23 per cent from 2011 to a record of 15.76 trillion yuan (HK$19.6 trillion) last year, and is set to rise further this year due to urbanisation and business expansion.

"Starting in 2013, the central bank will not only publish national TSF, but also regional TSF," Pan told an economic forum at the weekend. "TSF is an important indicator to help strengthen and improve financial and macroeconomic supervision and risk control."

Mainland banks are facing mounting risks as highly indebted local governments seek massive funding for construction projects to pursue higher economic growth.

The China Banking Regulatory Commission told lenders the "baseline" and the "top priority" this year were to prevent "systemic risk" and "regional risk".