The Chinese central bank has flagged the ongoing application of active guidance to ensure that domestic lenders channel more funds to desired areas of China’s real economy.
The People’s Bank of China (PBOC) convened a meeting with 24 of China’s leading banks on 1 April on the topic of “optimisation and adjustment of the lending structure.”
Zou Lan (邹澜), head of PBOC’s financial markets department, said that the central bank would “spur and guide financial institutions in optimising the loan structure for the manufacturing sector,” as well as set the goals and missions of “raising the manufacturing loan ratio” and “maintaining rational growth in medium and long-term loans for the hi-tech manufacturing sector.”
The meeting also called for “spurring more financial resources towards the low carbon green sector.”
Senior executives from listed Chinese banks have also flagged a focus on “optimisation and adjustment of the lending structure,” and expanding the vigour of lending in areas including financial inclusion, green finance and rural village revival.
“Financial inclusion micro and small loans will still be the focal point for bank loan operations, and banks will also expand the provision of loans for green development, rural village revival and tech innovations,” said Zeng Gang (曾刚), chair of the Shanghai Finance and Development Laboratory (上海金融与发展实验室).
Zeng also expects growth in property loans to markedly decline and their share of outstanding loans to fall, as Chinese regulators reiterate their position that “homes are for occupation, not speculation.”
ICBC, China’s biggest bank in terms of assets, saw the financial inclusion loan balance rise 58% in 2020 to hit 273.7 billion yuan, while China CITIC Bank has said that this year it plans to increase green loans by 80 billion yuan.