MNI China Press Digest, Feb 18: PBOC, Interest Rates, Growth

     BEIJING (MNI) - The following lists highlights from Monday's China press:

     The PBOC will likely expand its balance sheet in 2019, continuing to add

liquidity and encourage credit expansion via reverse repo, Medium-term Lending

Facility(MLF), Targeted MLF and other tools, the Securities Times said today.

Although seasonal factors are pushing new loans and money aggregates to

historical highs, it may also indicate a credit easing turning point, which will

play a positive role boosting growth and supporting financial assets, the paper

said.

     Financial institutions need interest rate liberalization if they are to

provide sustainable services to smaller private companies said Huang Yiping,

former advisor to the People's Bank of China, The Paper reported late Saturday.

Relaxation of the rules will increase rates in the formal financial sector

whilst lowering them in the informal areas such as shadow banking, Huang said,

the paper reported. Currently, SMEs are squeezed out of the formal financial

market, while informal financing rates are pushed up, Huang added.

     China has five new growth drivers, including improvements in inefficient

sectors like base industries; boosting low-income levels to help drive demand;

upgrading consumption and industrial structure, especially knowledge-intensive

services; cutting-edge innovation and green development, China Business News

reported late Saturday citing Liu Shijin, vice chairman of China Development

Research Foundation.

--MNI Beijing Bureau; +86 (10) 8532-5998; email: wanxia.lin@marketnews.com

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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