China’s newly formed banking and insurance regulator says it will push for local governments and state-owned enterprises to further reduce their leverage, as well as crackdown on shadow banking and cross-sector financial activity.
Guo Shuqing, head of the China Banking and Insurance Regulatory Commission (CBIRC) made the remarks at meeting held on 3 April.
According to an official statement from CBIRC the authority will “effectively perform structural deleveraging, and focus on reducing the leverage of local governments and enterprises, and in particular state-owned enterprises.”
CBIRC will also “effectively contain the trend of the excessively rapid rise in household leverage…firmly and unwaveringly rectify shadow banking and cross-sector financing, actively push for bank assets to return to balance sheets…and strictly strike against various forms of Ponzi schemes, illegal fund-raising and other forms of illicit and illegal financial activity.”
