China central bank urges proper management of risk, liquidity
Published on Feb 8, 2014 9:22 PM
BEIJING (REUTERS) - China's central bank urged commercial banks to properly manage liquidity while reiterating its promise to keep monetary policy stable and to clamp down on risky lending, noting that the world's second-largest economy has yet to find a stable base for growth.
In its quarterly monetary policy report released on Saturday, the People's Bank of China (PBOC) said it would step up oversight of lending in risky areas such as the property sector and industries struggling with overcapacity.
The bank is trying to rein in an explosion of off-balance sheet and risky lending as cautious government regulators resist speedier financial reform that would force markets to price risk more realistically.
"We will guide commercial banks to strengthen liquidity and asset liability management," the PBOC said, to make sure financial institutions are supporting the real economy rather than speculative activity.
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