China Press Digest Sep 23: LPR, Evergrande, Non-Coal Pledge

The following lists highlights from Chinese press reports on Thursday:

• China's lending rate benchmark, the Loan Prime Rate, may be more likely to be lowered if the People's Bank of China again cuts RRRs for banks in Q4 and reduces lenders' incremental capital costs, the China Securities Journal reported citing market participants. Should the 1-year LPR gets lowered, business lending costs may decline more quickly, spurring the real economy's financing demand and drastically easing SMEs' difficulties to raise money, the newspaper said citing analyst Wang Qing of Golden Credit Rating. Chinese monetary policies are likely to continue pushing for lower real lending rates and favouring innovation, sustainability and small businesses, said the journal.
• Chinese commercial banks are making public statements to declare that their risk exposures to the debt-ridden Evergrand Group are controllable, Yicai.com reported. Among the many banks making the public statements, Industrial Bank said its existing business with the Group has sufficient collateral, while Zheshang Bank stated that the current lending amount to Evergrande Group is CNY3.8 billion, with sufficient collateral, Yicai reported. MNI noted that global financial markets were stung in recent days as concerns intensified that the liquidity crisis faced by Evergrande could spark sustained contagion.
• President Xi Jinping's pledge not to build coal-fired power plants abroad will force Chinese companies to phase out these high-polluting power generators and abandon projects in coal-rich countries such as Indonesia and Bangladesh, the Global Times reported citing interviews with sources at state-owned firms. China, the world's largest builder of thermopower generators, will support developing countries with building low-carbon energy, Xi said at the UN General Assembly on Tuesday. Chinese contract builders are set to suffer more as they had been focusing on developing overseas markets in response to China's push for cleaner domestic power generation, the newspaper said.