China will reduce number of high-risk institutions, defuse ‘bombs’: Central bank

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BEIJING: China will steadily reduce the number of high-risk institutions to help fend off systemic financial risks, its central bank said on Wednesday (Mar 15).

Reforms of problematic small and mid-sized financial institutions have made key progress and illegal financial activities have been curbed, the People’s Bank of China (PBOC) said in a statement after its annual meeting on financial stability.

The central bank will continue to follow the guidance of “overall planning and coordination, differentiated policies and precise bomb disposal”, it said.

“It is necessary to strengthen the financial risk disposal mechanism and capacity building, strengthen monitoring, early warning and evaluation,” the central bank said.

The central bank will improve legislation and the financial stability guarantee fund system, and improve the role of deposit insurance, the central bank added.

China’s economy showed a gradual though the uneven recovery in the first two months, but statistics bureau spokesman Fu Linghui told a briefing on Wednesday that corporate and personal balance sheets damaged during the pandemic would need time for repair. 

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