Financial risks in key areas are being resolved, says PBOC's chief

By Bloomberg News

China’s central bank chief said financial risks in key areas are being resolved in an orderly manner, while stressing the importance of stabilizing expectations and boosting confidence to ensure economic recovery.
 

The government will encourage financial institutions to increase support for weak links or in key areas, satisfy “reasonable” consumer financing demands in a more targeted manner and study measures to enhance the coordination of macro policies, People’s Bank of China Governor Pan Gongsheng said in an interview with state broadcaster China Central Television that aired Saturday.

Chinese policymakers have long relied on guidance to financial institutions to accelerate or scale back lending as a way to influence the economy. Earlier this week, state media published a pair of interviews with Pan, in which he pledged further steps to support the nation’s economic recovery, while cautioning that it won’t be adopting “drastic measures.”

The central bank will continue to adhere to a supportive monetary policy stance and promote rational growth in credit and the stable reduction in financing costs, according to Pan. China will also maintain the basic stability of the yuan exchange rate at a reasonable and balanced level, he added. 

The number of high-risk small and medium-sized banks have halved from the peak, Pan also said.