BEIJING Dec 16 China's banking regulator said
on Friday that banks must strictly control credit to coal and
steel firms that are violating capacity cuts, the latest in a
series of regulations aimed at reducing loans to industries
struggling with over-capacity.
The China Banking Regulatory Commission (CBRC) told banks to
stop providing financial support to "zombie firms" and companies
in breach of the government's capacity reduction plans, the CBRC
said in an online statement.
The regulator also required banks to increase their
awareness of the "strategic status" of the coal and steel
sectors, and meet the "reasonable" funding demand of competitive
The banking regulator said it encourages lenders to use
financing for mergers and restructuring in the steel and coal
(Reporting By Shu Zhang and Matthew Miller; Editing by Shri