REPEAT:MNI: China MonPol Still Prudent, Hasn't Tightened: PBOC

Repeats Story Initially Transmitted at 04:22 GMT Apr 25/00:22 EST Apr 25

     BEIJING (MNI) - The following lists key points from a briefing by top

Chinese monetary and banking officials Thursday. Those present included People's

Bank of China Deputy Governor Liu Guoqiang and Sun Guofeng, the central bank's

director of monetary policy department. 

     - The prudent monetary policy currently pursued is appropriate in equal

measure, said Sun, saying its neither been loosened nor tightened. Policymakers

don't want to see either a shortage or excess of liquidity, he added.

     - The Targeted Medium-term Lending Facility (TMLF) conducted by the PBOC

Wednesday was for short-term adjustment and doesn't represent a change in policy

direction, Liu said. 

     - To properly gauge the effect of liquidity policies, the market should pay

attention to interbank market rates, such as the DR001 and DR007, and not look

at external indicators such as housing prices, Liu said.

     - Measures to improve financing for private small businesses are to

optimize the lending structure and won't boost overall leverage, said Sun. The

overall amount of credit is controlled, but private businesses are getting a

bigger share of allocation, said Deputy Governor Liu.

     - Liu said that despite the current policy push to boost lending to the

private sector, China needs to look at more sustainable ways to ensure private

funding needs are met while keeping risks managed. 

     - Li Junfeng, an official from the China Banking and Insurance Regulatory

Commission, denied market speculation that some banks have lent to small

businesses at below base rates. A rate between 5% and 5.7% is seen as able to

cover the cost of lending if the risks are appropriately managed, and lending at

too low a level would only encourage arbitrage, he said. 

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

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