MNI China Press Digest, May 25: Fiscal, Bank Profits, Subsidy

     BEIJING (MNI) - The following lists highlights from Chinese press reports

on Monday:

     China's fiscal and financial system is healthy and the Government has ample

ammunition for both fiscal and monetary policy, the China Business News

reported. Citing Yang Weimin, the former deputy director of the Central Leading

Group for Finance and Economics, the report said that China had not yet

completed its historical mission of urbanisation. Enabling 300 million migrant

workers to settle in cities would significantly expand domestic demand and drive

growth, Wang said. 

     Profits at Chinese banks could slide and some may post negative growth this

year, according to an article published by the PBOC's research bureau on China

Finance. Banks will face increasing pressure on non-performing loan disposal and

capital consumption as the difficulties in the real economy are transmitted to

the financial sector, the article said. Faced with this scenario, banks should

increase their provisions and supplement capital to prepare for possible risks.

Commercial banks achieved a net profit of CNY600.1 billion for the first quarter

of 2020, an increase of 5% y/y compared with the 9.4% gain in Q1 2019. 

     Local governments should consider directly subsidising people on low

incomes and this could be combined with helping private and small companies, the

21st Century Business Herald reported. Citing Liu Shijin, the deputy director of

the Economic Committee of the CPPCC National Committee, the Herald's report said

the government could provide direct wage subsidies or issue consumer vouchers to

employees of SME's whose income is below a certain level. Liu said that consumer

coupons issued to the public recently failed to adequately target troubled SMEs

and low-income workers. 

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

--MNI Sydney Bureau; +61 405322399; email: lachlan.colquhoun.ext@marketnews.com

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