Nod for 5 new private lenders

Source: Xinhua | 2016-12-28

CHINA’S banking regulator yesterday gave approval to five new private banks, bringing the number of such lenders to 16.

The five banks will be in Beijing and the provinces of Jiangsu, Jilin, Liaoning and Shandong, the China Banking Regulatory Commission said.

Each of the banks will be co-sponsored by at least two private capital providers.

In 2014, China approved a pilot scheme setting up five private banks to give private capital a bigger role in the country’s financial system.

The new private banks are set to boost financial support for smaller firms, as the state-owned lenders usually favor state-owned enterprises.

Small and medium-sized enterprises account for around 60 percent of China’s gross domestic product and some 80 percent of new jobs, but they are struggling to cope with weaker global demand and tight credit.

Data from the CBRC showed the total assets of the first batch of five private lenders were 132.93 billion yuan (US$19 billion) at the end of September.