BEIJING, July 4, Reuters - Guo Shuqing, chairman of the China Banking Regulatory Commission (now the Banking and Insurance Regulatory Commission), sounded the clarion call to tackle financial turmoil at the beginning of his term of office, followed by regulatory documents such as "3340" which officially opened the prelude to the battle against risk. Over the past two years, the alarm against major risks has been alleviated, financial risks have shifted from divergence to convergence, and the policy focus is shifting from financial risk prevention to improving the ability of the real economy of financial services.
At a news conference held on Thursday by the State New Office of Banking and Insurance Regulatory Commission, officials pointed out that over the past two years, through unswerving measures such as dismantling high-risk shadow banks and actively dealing with non-performing loans, the prevention and mitigation of financial risks has achieved phased results; at the same time, in the process of implementing the structural reform of the financial supply side, private enterprises and small enterprises have made progress. Financial services in weak areas such as micro-enterprises have also improved significantly.
"Over the past two years, (the regulatory level) has vigorously suppressed the nested, complex and self-cycling high-risk financial assets of RMB 13.74 trillion, effectively curbing financial fragmentation and weakening, while vigorously eradicating the soil of credit risk." Zhou Liang, vice chairman of the Banking and Insurance Regulatory Commission, said.
He also pointed out that over 4 trillion yuan of non-performing loans have been disposed of in the past two years. At present, the rate of non-performing loans in banking industry is stable at about 2%, and the reserve coverage rate is over 175%. The major regulatory indicators such as capital adequacy ratio of commercial banks and comprehensive solvency ratio of insurance companies are at a good level.
At the same time, the risk of high-risk institutions is gradually resolved, major cases of illegal fund-raising are being dealt with in an orderly manner, and the effect of reducing the risk of online lending is obvious. The number of online lending institutions has dropped by 57% compared with the beginning of 2018.
"It can be said that there is enough ammunition to resist risks. Financial risks have gradually shifted from divergence to convergence and can be controlled as a whole." Zhou Liang said.
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