DELEVERAGING CAMPAIGN
China orders banks to ‘significantly cut’ rates for small business
Beijing — China’s financial regulator has told banks to "significantly cut" lending rates for small firms in the third quarter in comparison with the first quarter, two people with direct knowledge of the matter told Reuters on Monday. The move comes amid a Chinese deleveraging campaign to crack down on financial risks and economic uncertainty, triggered by a trade war with the US that economists have cautioned could slow down China’s economic growth. The economy has felt the pinch from the multiyear crackdown on riskier lending that has driven up corporate borrowing costs, prompting China’s central bank to pump out more cash by cutting reserve requirements for the country’s lenders. In a nonpublic notice issued by the China Banking and Insurance Regulatory Commission (CBIRC) in late June, the regulator also asked banks to increase real-time monitoring of lending rates, the two people with knowledge of it said.
The CBIRC did not immediately respond to an e-mailed request seeki...
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