October 30, 2018 / 6:34 AM / a year ago

China to release new rules to further increase lending to smaller firms

FILE PHOTO: A China yuan note is seen in this illustration photo May 31, 2017. REUTERS/Thomas White/Illustration/File Photo

BEIJING (Reuters) - China’s banking and insurance regulator will soon release new rules to further boost financing to small and medium-sized companies, it said in a press release circulated ahead of a media briefing.

The China Banking and Insurance Regulatory Commission said it would encourage financial institutions to take full advantage of the latest monetary, fiscal and tax policy steps to increase lending to smaller firms.

The regulator would support commercial banks to issue special bonds for lending to small firms and apply favourable risk weighting to evaluate bank loans to smaller firms, it said.

The average interest rate for loans made by 18 major commercial banks to smaller firms stood at 6.23 pct in the third quarter, 0.7 percentage point lower than the first quarter.

Reporting By Yawen Chen and Vincent Lee, Writing By Shu Zhang; Editing by Shri Navaratnam

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