February 15, 2020 / 6:07 AM / 4 days ago

China's central bank says lenders to tolerate higher bad loans to support virus-hit firms

FILE PHOTO: A woman wearing a mask walks past the headquarters of the People's Bank of China, the central bank, in Beijing, China, as the country is hit by an outbreak of the new coronavirus, February 3, 2020. REUTERS/Jason Lee/File photo

BEIJING (Reuters) - China’s central bank said on Saturday that the country’s lenders will tolerate higher levels of bad loans, part of efforts to support firms hit by the coronavirus epidemic.

“We will support qualified firms so that they can resume work and production as soon as possible, helping maintain stable operations of the economy and minimising the epidemic’s impact,” Fan Yifei, a vice governor at the People’s Bank of China, told a news conference.

He added that the problem will be manageable as China has a relatively low bad loan ratio.

Liang Tao, vice chairman of the China Banking and Insurance Regulatory Commission, told the same briefing that lending for key investment projects will be sped up.

Separately, Xuan Changneng, vice head of the country’s foreign exchange regulator, said China was expected to maintain a small current account surplus and keep a basic balance in international payments.

More than 2,600 new cases were confirmed in mainland China, health officials said on Saturday, a day after people returning to the capital from holidays were ordered to quarantine themselves for 14 days.

Reporting by Kevin Yao in Beijing, Writing by Winni Zhou; Editing by Edwina Gibbs

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