MNI China Press Digest March 2: Financial Regulation, WMP

     BEIJING (MNI) - The following are highlights from the Chinese press for

Friday:

     Wealth management products, off-balance sheet deals and shadow banks will

be "priority of the priority" for China's financial regulations this year, China

Securities Journal said in a report citing official and industry sources.

Banking regulators emphasized illicit activities would receive severe

punishment, Journal said citing an official. Banking and other security

regulators will together scrutinize cross-market products under the direction of

the State Council Financial Stability and Development Committee, Journal said

citing the official.

     China should continue to control financial risks and push for deleveraging,

which will be a key agenda at the National People's Congress next week,

Financial News reported. Major risks in China's economy include high leverage

ratios, liquidity risks, bad loans, shadow banking, hidden local government debt

and property bubble, the newspaper said. The property market and financial

sector need to be reformed to a more sustainable cycle; regulators should curb

excessive speculation, prevent rapid growth of leverage ratio in the household

segment and rein in illegal financing for home purchasers and developers, the

newspaper said.

     Growth in China's wealth management sector is expected to slow after it

gets introduced sometimes this year, Economic Information Daily reported.

Regulations are expected to remain tight in areas such as clamping down on

financial institutions' activities, maintaining certain rates of return on

investment or principle, and removing complicated dealings: Daily said citing

industry insiders.

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

--MNI Beijing Bureau; +86 10 8532 5998; email: william.bi@mni-news.com

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