At a meeting on Wednesday chaired by Governor Yi Gang, the People’s Bank of China said the international economic and financial environment remained complex. Photo: Reuters

China’s central bank eyes ‘noticeable decline’ in interest rates to help drive growth

  • People’s Bank of China says it will ‘make flexible use of multiple monetary tools to maintain reasonably ample liquidity … deepen interest rate liberalisation’
  • Credit support for private firms will be ‘in line with their contribution to the economy and society’, it says
Topic |   China economy

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At a meeting on Wednesday chaired by Governor Yi Gang, the People’s Bank of China said the international economic and financial environment remained complex. Photo: Reuters
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Virtually all Chinese banks already set aside more money than the required minimum to compensate for bad loans. Photo: Reuters

China intends to boost bank dividends with proposed cap on bad loan provisions, but will this backfire?

  • China’s Finance Ministry has proposed a new rule that would cap the amount banks have to set aside for bad loans
  • Loan loss provisions should not exceed twice of the minimum regulatory level with any excess funds released as profits
Topic |   China economy

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Virtually all Chinese banks already set aside more money than the required minimum to compensate for bad loans. Photo: Reuters
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