Lenders told to think of smaller firms

Chinese banks are being encouraged to lend more to small and micro-sized businesses through "targeted" monetary policy tools, in a bid to ease financial stress and control debt defaults.

The measures could be officially announced by the People's Bank of China, the nation's central bank, as soon as within a week, and take effect in the third quarter, according to market analysts.

The tools include another cut to the reserve requirement ratio (RRR), the cash amount that financial institutions are required to hold. But the lower ratio is only for lenders providing loans to small and micro-sized businesses, according to a statement issued following a meeting of the State Council on Wednesday.