The China Banking Regulatory Commission (CBRC) issued a guideline on April 7 for the banking sector to promote supply-side structural reform and better serve the real economy.
The guideline introduced three major measures, which include implementing differentiated credit policies and creditors’ committee system, accelerating disposal of bad assets, and carrying out flexible housing policies that fit the special conditions of different cities.
Xu Jieqin, deputy director of the Policy Research Bureau of CBRC, said efforts should be made to ban irregular capital inflows to the housing market, reduce housing inventory in third- and fourth-tier cities, and continue to support urbanization and shantytown renovations.
The document also put forward measures such as promoting debt-to-equity swap, enhancing management of service charges, strengthening financial services for the agriculture sector, small and medium-sized enterprises (SMEs) and other key industries.
Financial support should be increased for development of the Beijing-Tianjin-Hebei region, the Yangtze River Economic Belt and the Belt and Road Initiative, according to the document.
To put the measures in place, the guideline called for efforts to improve banks’ corporate governance, expand inclusive financial system reform, promote pilot models for investment and loan linkage, develop the role of finance in national development, and bring in private capital to the banking sector.
CBRC encourages banks to explore inclusive financial system reform in various forms, in order to improve the coverage of financial services and solve SMEs’ financing difficulties, Xu said.
Financial institutions should enhance internal regulations, abide by related laws and regulations, include innovative businesses in the overall risk management system, and investigate irregular businesses.