China regulator to offer liquidity support to rural commercial banks

BEIJING (Reuters) – China’s banking and insurance regulator said on Tuesday it will offer cross-region liquidity support for rural commercial banks.

Worries about the health of China’s smaller lenders were renewed last week following a second bank run on Yingkou Coastal Bank in less than two weeks.

Yingkou Bank’s bank run is a one-off event triggered by negative rumors, Liu Rong, an official from China’s Banking and Insurance Regulatory Commission (CBIRC), told a news briefing.

CBIRC will encourage banks to rescue themselves first when in trouble, Liu added.

The non-performing loan ratio of rural commercial banks was at 4% by end-September, down 0.19 percentage point year on year, the regulator said.

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