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CBRC regulator warns of local debt risks

By Hu Yang (chinadaily.com.cn)
Updated: 2011-03-15 15:03

China's banking regulator said it will ask banks to control credit risks, especially loans to local governments' financing vehicles, the Shanghai Securities News reported Tuesday.

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Liu Mingkang, head of the China Banking Regulatory Commission (CBRC), said the credit risks might increase. He said the CBRC will launch stricter measures to supervise such risks.

China's new loan growth slowed to 17.7 percent in the first two months of this year. That's a decrease of 2.2 percentage points compared to the previous year.

Liu said profits for the banking industry might see some decline this year, but the overall loan growth won't be significantly less than last year.