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MNI BRIEF: PBOC To Provide Emergency Liquidity - Governor Pan

MNI (Beijing)

The People’s Bank of China will provide emergency liquidity support when necessary to heavily indebted local governments and enhance credit aid to property developers, Governor Pan Gongsheng said Wednesday.

Pan, speaking at the 2023 Financial Street Forum in Beijing, said lenders will help local governments extend loans, swap existing debt and control incremental debt, and the regulator will monitor financial debt of local government funding vehicles. The Bank will support local governments to divest their funding vehicles and transform them into market-oriented enterprises that do not rely on government credit and are financially independent.

On the property sector downturn, Pan believed the impact on the financial system is “generally controllable”, and noted lenders will stabilise financing channels for real estate developers including bank loan and bond issuance.

The Bank will also encourage small and medium-sized banks to replenish capital via additional sources, he said.

MNI Beijing Bureau |
MNI Beijing Bureau |

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