* PBOC asks Shanghai banks for asset quality, credit report
* Banks include CDB, BoC and AgBank, sources say
* Request comes as banks prepare for routine quarterly
(Adds names of banks impacted, context)
SHANGHAI, June 14 China's central bank is asking
lenders in Shanghai for information on how recent regulatory
tightening is effecting their lending and credit quality, two
people with direct knowledge of the matter said on Wednesday.
The recent request is in addition to information Chinese
banks must provide for the central bank's quarterly risk
assessment, known as MPA.
Banks in Shanghai recently received a notice from the
People's Bank of China (PBOC) asking them to provide the current
size and industry distribution of their loan portfolio and
report on how new loans in 2017's first half compared to a year
earlier, the two said.
The Shanghai office of the PBOC also requested information
on any impact the increased regulatory scrutiny has had on new
loans, off-balance-sheet assets and the movement of assets from
off-balance-sheet to on-balance-sheet, they added.
The PBOC was not immediately available for comment.
The banks notified include China Development Bank, Postal
Savings Bank of China, Bank of Shanghai,
Shanghai Pudong Development Bank, Agricultural Bank
of China and Bank of China among others,
according to the two people.
None of the banks responded immediately to a request for
The notice was sent at a time Chinese banks have been
preparing for the Macroprudential Assessments (MPA) the central
bank conducts for all lenders.
China's banks have come under tougher regulatory scrutiny
since the beginning of this year after the banking regulator
released a slew of requests for self-inspections on matters
ranging from credit risk to compliance.
Though the tighter regulations have so far mainly been aimed
at tamping down speculative activity and riskier forms of
lending, many analysts believe they will eventually lead to
higher financing costs for companies and drag on economic
Fund managers surveyed by BofA Merrill Lynch said Chinese
credit tightening ranked as the top "tail risk" for investors in
June, for the second straight month (31 percent), with 61
percent of investors saying tighter Chinese monetary policy will
slow the economy but have little impact on global growth.
According to the people knowledgeable about the PBOC
Shanghai notice, it asked banks there whether bond issues have
had an impact on credit needs and whether enterprises having
difficulties issuing bonds have pivoted to borrowing, the people
In addition, the PBOC wants to know about the impact policy
changes have had on loans to developers and mortgages, the
(Reporting by Li Zheng and Engen Tham in Shanghai; Editing by