On the afternoon of February 15, the People’s Bank of China (PBC) held a briefing on the financial statistics of January 2019. Zhou Xuedong, Director-general of General Administration Department and News Spokesperson of the PBC, hosted the briefing. Sun Guofeng, Director-general of the Monetary Policy Department, Ruan Jianhong, Director-general of the Statistics and Analysis Department and Spokesperson and Zou Lan, Deputy Director-general of the Financial Market Department attended the briefing and took questions from the press, including China Daily, Caixin, Reuters and Bloomberg News. The following is the transcript.
Zhou Xuedong: Dear friends from the press, good afternoon! Welcome to today’s press briefing. The financial statistics of January 2019 has drawn wide attention, so today we invite several officials in charge of relevant departments to interpret the financial statistics of January and respond to the hot-spot issues at present. First of all, let’s welcome Director-general Ruan Jianhong to release the financial statistics of January 2019.
Ruan Jianhong: I will introduce the basics of China’s financial statistics of January 2019.
Since 2019, following the arrangements of the CPC Central Committee and the State Council, the PBC has been maintaining sound monetary policy appropriate in intensity, highlighting countercyclical adjustment, carrying out preemptive adjustment and fine tuning, stabilizing market expectations, enhancing policy communication and coordination, smoothing monetary policy transmission, guiding capital flow to such key areas and weak links as private enterprises and small and micro businesses (SMBs), and taking tough steps to forestall and defuse major risks. In general, currently the liquidity of the banking system is reasonable and adequate, money, credit and aggregate financing to the real economy (AFRE) are growing rationally, and the market interest rates are stable.
The first is the aggregate financing to the real economy (AFRE). According to preliminary statistics, AFRE (flows) was RMB 4.64 trillion in January 2019, up RMB 1.56 trillion year-on-year. The outstanding AFRE reached RMB 205.08 trillion at end-January with an increase of 10.4% year-on-year, up 0.7 percentage point from a month earlier and down 2.3 percentage points from a year earlier.
The second is money supply. At end-January, broad money supply (M2) stood at RMB 186.59 trillion, increasing by 8.4% year-on-year, up 0.3 percentage point from a month earlier and down 0.2 percentage point from a year earlier. Narrow money supply (M1) stood at RMB 54.56 trillion, increasing by 0.4% year-on-year, down 1.1 percentage points from a month earlier and 14.6 percentage points from a year earlier. Cash in circulation (M0) recorded RMB 8.75 trillion, increasing by 17.2% year-on-year. The month saw a net cash injection of RMB 1.43 trillion.
The third is loans. At end-January, outstanding RMB and foreign currency loans totaled RMB 145.1 trillion, up 12.8% year-on-year. Outstanding RMB loans grew by 13.4% year-on-year to RMB 139.53 trillion, down 0.1 percentage point from a month earlier but up 0.2 percentage point from a year earlier. In January, RMB loans increased by RMB 3.23 trillion, RMB 328.4 billion more than the growth in the same period last year. The outstanding foreign currency loans stood at USD 832.4 billion, down 6% year-on-year. In January, foreign currency loans increased by USD 37.5 billion, USD 9.8 billion less than the growth in the same period last year.
The fourth is deposits. At end-January, the outstanding amount of RMB and foreign currency deposits was RMB 185.8 trillion, up 7.2% year-on-year. RMB deposits recorded an outstanding amount of RMB 180.79 trillion, rising by 7.6% year-on-year, down 0.6 percentage point from the end of last month and 2.9 percentage points from a year earlier. In January, RMB deposits rose by RMB 3.27 trillion, slowing down by RMB 581.5 billion year-on-year. The outstanding amount of foreign currency deposits was USD 746.8 billion, down 10.6% year-on-year. In January, foreign currency deposits rose by USD 19.3 billion, USD 25.5 billion less than the growth in the same period last year.
The fifth is market trading and interest rates. In January, lending, cash bond transactions and repo transactions in the interbank RMB market totaled RMB 104.66 trillion, with the daily average rising by 30.5% year-on-year to RMB 4.76 trillion. In January, the weighted average rate for interbank lending stood at 2.15%, down 0.42 percentage point month-on-month and 0.63 percentage point year-on-year. The weighted average rate for pledged repos was 2.16%, down 0.52 percentage point month-on-month and 0.72 percentage point year-on-year.
The sixth is foreign exchange reserves and foreign exchange rate. At end-January, the outstanding foreign exchange reserves was USD 3.09 trillion, and the exchange rate for CNY/USD was 6.7025.
The seventh is cross-border RMB settlement. In January 2019, RMB settlement for cross-border trade in goods, cross-border trade in services, other current account items, ODI and FDI amounted to RMB 360.36 billion, 117.68 billion, 49.59 billion and 152.72 billion respectively.
The above are the basics of the financial statistics of January 2019. These statistics have been released on the official website of the PBC.
Zhou Xuedong: Thanks to Director-general Ruan. Now we will answer questions you are concerned with.
Q: At the end of January 2019, the growth rate of M2 was 8.4%, up 0.3 percentage point compared with the end of last year. May I ask what has supported the rising growth rate of M2? And how do you look at the further drop of M1 following its slow growth last year?
Ruan Jianhong: It should be said that the increase in M2 growth rate in January was a result of the monetary policies at an earlier stage.
Firstly, the PBC moderately increased the medium and long-term liquidity supply. On the basis of multiple policies issued to release liquidity in 2018, the PBC cut the required reserve ratio (RRR) again to release liquidity of RMB 1.5 trillion, carried out targeted medium-term lending facility (TMLF) operation, and completed the assessment of targeted RRR cuts in 2018 for inclusive finance in January this year. All these measures were conducive to maintaining liquidity reasonable and adequate.
Secondly, commercial banks increased its use of funds. Growth of on-balance-sheet credit, bond investment and equity and other investments drove the rise of M2 growth rate. In January, the on-balance-sheet credit grew by RMB 3.23 trillion, RMB 328.4 billion more than the growth in the same period last year; bond investment rose by RMB 406.2 billion, RMB 358.3 billion more than the growth in the same period last year; and equity and other investments increased by RMB 846.5 billion, RMB 306.6 billion more than the growth in the same period last year.
Besides, we also saw that the M1 growth rate further fell due to Spring Festival. As mentioned before, the fall of M1 mainly reflects the structural changes in the liquidity of the society rather than the changes in its aggregate size. This was more evidently seen in January. End-January was close to the Spring Festival when the peak of salary and bonus payments of businesses came. As a result, the institutional demand deposits considerably decreased by RMB 2.03 trillion, while individual deposits and M0 grew substantially. In January, individual deposits recorded a substantial growth of RMB 3.87 trillion, up 15.5% year-on-year; and M0 increased by RMB 1.43 trillion, up 17.2% year-on-year. It should be said that general public held more money in the Spring Festival than before.
I’ve briefed about basic statistics. Later, Director-general Sun will interpret the monetary policy in details.
Q: We observed that the growth of the AFRE has been constantly slowing down since July 2017. However, it remarkably picked up in January as mentioned just now. Could you please further illustrate the reasons and the structural characteristics of the pick-up?
Ruan Jianhong: The AFRE (flows) in January 2019 was up RMB 3.05 month-on-month and RMB 1.56 trillion year-on-year. The outstanding AFRE grew by 10.4% year-on-year at end-January, up 0.7 percentage point month-on-month.
AFRE registered a huge increase in January with its growth notably picked up, which showed intensified financial supports to the real economy as a result of the monetary policy gradually taking effect. Regarding the breakdown of AFRE, all items of large shares saw evident recovery, mainly in the following four aspects.
Firstly, loans grew at a faster pace with much more increase over the year before. The growth rate of loans of financial institutions to the real economy has turned to steady increase from slight drop since the second half of last year. In January this year, this trend continued, while seasonal factors at the beginning of the year also added up to it. Therefore, the loan grew more rapidly with much more year-on-year increase . The outstanding RMB loans at end-January were RMB 138.26 trillion, up 13.6% year-on-year, 0.4 percentage point higher than the same period last year. RMB loans increased by RMB 3.57 trillion, up RMB 881.8 billion year-on-year.
Secondly, the bond financing increased considerably. Its growth began to gain momentum from the second quarter last year. In January this year, the growth rate of corporate bonds recovered markedly. The outstanding corporate bonds were RMB 20.5 trillion at end-January, up 10.7% year-on-year, which was 2 and 7.3 percentage points higher from a month earlier and a year earlier respectively, marking the peak since April 2017. The net financing of corporate bonds stood at RMB 499 billion, up RMB 376.8 billion year-on-year. And more local government bonds were issued. The net financing of local government special bonds reached RMB 108.8 billion, up RMB 108.8 billion year-on-year.
Thirdly, the decline of entrusted loans narrowed, and trust loans turned positive from negative. This was a new feature of the structure of AFRE in January this year. Entrusted loans registered a decrease of RMB 69.9 billion, RMB 151.1 billion and RMB 1 billion less than the decrease a month earlier and a year earlier respectively, showing an evident slowdown in the decline; and trust loans registered an increase of RMB 34.5 billion, marking the first increase after declining for ten consecutive months and RMB 83.3 billion more than the growth of last month.
Fourthly, commercial banks intensified their supports of commercial credit to enterprises, mainly in two aspects. On the one hand, bill financing increased sharply by RMB 516 billion, RMB 481.3 billion more than the growth in the same period last year, which was shown in the RMB loans in the same month. On the other hand, undiscounted bankers’ acceptances rose considerably by RMB 378.6 billion, RMB 234.9 billion more than the growth in the same period last year.
Q: What’s your take on the record-breaking loans in January?
Sun Guofeng: In January 2019, the RMB loans issued by financial institutions increased by RMB 3.23 trillion, hitting a new monthly high, an increase of RMB 328.4 billion from the growth in the same period last year. The outstanding loans at end-January grew by 13.4% year-on-year, up 0.2 percentage point from a year earlier. Generally, higher increase in the loans in January was primarily attributed to the strengthened countercyclical adjustment in macro control, marginal improvement in monetary policy transmission and some seasonal factors. Since 2018, especially the fourth quarter, the PBC has taken a series of measures to ease the constraints on the credit supply of banks, and smooth monetary policy transmission. The measures included (1) encouraging banks to issue perpetual bonds, which was taken as the breakthrough to relieve the substantive constraints of capital on banks regarding credit supply; (2) integrating the use of such measures as targeted RRR cut, medium-term lending facility (MLF), central bank lending and central bank discount, launching the targeted medium-term lending facility (TMLF), designing incentive compatibility mechanism while easing the liquidity constraints faced by some banks to guide financial institutions to enhance their supports to the real economy and increase credit granted to small and micro businesses (SMBs) and private enterprises; and (3) promoting the convergence of the benchmark rate and market interest rate, smoothing the transmission of central bank policy rate to credit rate to relieve credit constraints. These measures are taking effects. The monetary policy transmission generated marginal improvement, and the financial sector intensified its supports to the real economy. In the meantime, it is a tradition among banks to “strive for early revenues with early input” and to “get off to a flying start” in their operation. Throughout history, January has been the month with the highest lending in the entire year. The loans increased by RMB 2.9 trillion in January 2018, making the month witness more lending than any other months. The same goes for this January. Matching the demand of the real economy, the lending was reasonable, not massive liquidity injection. Considering the Spring Festival, statistics of January and February and even the first quarter should be analyzed as a whole. Therefore, statistics of a single month should not be too much of a concern.
Q: Has the stance of sound monetary policy changed?
Sun Guofeng: The stance of sound monetary policy remains unchanged. “Soundness” is the working principle and guidance of monetary policy. It highlights the stability of monetary policy, and adheres to the underlying principle of pursuing progress while ensuring stability, which requires that countercyclical adjustment be implemented effectively and properly. To be specific, money conditions should match the requirement of maintaining steady economic growth and stabilized prices without being too tight or too loose. The monetary policy should, under the requirements of maintaining steady economic growth and guarding against systemic risks, keep the aggregate at an appropriate level, optimize credit structure while ensuring external equilibrium and achieve an overall balance among multiple targets. The liquidity supply operations of monetary policy have been well-paced, and combined with incentive mechanism. Implemented in two steps, the RRR cut in January 2019 released around RMB 300 billion long-term liquidity after replacing mid-term lending facilities. It hedged the cash injections in the run-up to the Spring Festival, avoided excessive liquidity while taking into account such liquidity demand factors as tax payment, credit increase at the beginning of the year and advance issuance of local government bonds. And in terms of the aggregate, both broad money and the AFRE grew reasonably and evolved with condition changes, responding to the requirement of the countercyclical adjustment. The pace was affected by seasonal factors including the Spring Festival. The macro leverage ratio remained stable. Therefore, it was far from easing monetary policy. With regards to the credit structure, major efforts were made to strengthen supports in such key areas and weak links as SMBs and private businesses. Moreover, medium and long-term loans granted to the manufacturing sector, in particular the high-tech manufacturing, grew at an evidently accelerated pace. The quality of the financial sector serving the real economy was improved, facilitating the restructuring and upgrading of the economy. At the same time, the relationship between internal and external balances was well-handled. Generally speaking, valuable experience of better serving the real economy without massive indiscriminate stimulus has been accumulated in the monetary policy explorations.
Q: What about the growth of loans to SMBs in January?
Ruan Jianhong: The PBC has been earnestly implementing the decisions and arrangements of the CPC Central Committee and the State Council, constantly pooling the concerted efforts of relevant government authorities, and carrying forward with the “three arrows” policy. As a result, loans to SMBs in January this year maintained the trend of “increased size, reduced price and expanded coverage” since the second half of last year.
Firstly, loans to SMBs in inclusion area maintained rapid growth. By end-January 2019, the outstanding loans to SMBs in inclusion area (including loans to SMBs with a single-account credit line of up to RMB 10 million and business loans to self-employed businesses and SMB owners) stood at RMB 9.7 trillion, registering a growth of 17.6% year-on-year, 2.4 percentage points higher than the growth rate at the end of last year. In January, the loans increased by RMB 210.9 billion, 2.6 times as many as a year earlier.
Secondly, the interest rate of loans to SMBs continued to decrease. The PBC, through liquidity support, guided the downward shift of fund price. In January 2019, the average interest rate of newly granted SMB loans lower than RMB 10 million stood at 6.16%, dropping 0.12 percentage point from the previous month and 0.21 percentage point from the same period last year.
Thirdly, the SMB accounts supported by the loans kept increasing. By end-January 2019, the loans to SMBs in inclusion areas supported 21.65 million SMB entities, an increase of 260,000 in January, up by 70,000 over the year before.
Fourthly, the loans gave strong supports to labor-intensive industries. In January 2019, in the increment of loans to SMBs with a single-account credit line of up to RMB 10 million, loans to enterprises in manufacturing industry and wholesale/retail industry accounted for 38.5% and 24.6% respectively.
Next, the PBC will continue to follow the requirements of the CPC Central Committee and the State Council to guide the financial institutions to intensify their financial services and supports to SMBs.
Q: It is viewed by some that in the credit bond issuance in January this year, highly-rated bonds were popular while the private enterprise bonds went cold. How to consider this issue?
Zou Lan: Recently, a view arises that the trend of credit bond issuance in January 2019 was “highly-rated bonds were popular while the private enterprise bonds went cold” . After analysis, our opinions are as follows:
First of all, the credit bond issuance in January continued good momentum in general. Corporate credit bonds of approximately RMB 950 billion were issued in January 2019, an increase of 17.7% month-on-month and 165% year-on-year, keeping the good growing momentum since November 2018.
Secondly, the issuance and net financing for credit bonds of medium and low ratings further improved. In January 2019, RMB 102.8 billion of corporate credit bonds that are rated AA or below were issued, an increase of 28.1% month-on-month, accounting for 10.84% of the total corporate credit bonds, up 0.98 and 0.76 percentage points compared to December 2018 and the year 2018 respectively. Besides, the net financing for corporate credit bonds rated AA or below was around RMB 9.3 billion this month, the first time in recent six months to rise from negative to positive.
Last, the issuance of private enterprise bonds in January slightly declined month-on-month, but still stood at a high level compared to the same period since 2017. In January 2019, private enterprise bonds of RMB 60.4 billion were issued, though slightly lower than the figure of December 2018, still up by 51% and 60% compared with January 2017 and 2018 respectively, remaining at a high level compared to the same period since 2017. In addition, the issuance size of private enterprise asset-backed securities further elevated, providing additional funds for the financing of private enterprises.
In conclusion, we believe that in general the credit bond issuance in January grew in good momentum with improvements in bonds of medium and low ratings and the private enterprise bond financing, but highly-rated bonds were more popular, indicating that the liquidity in the bond market was reasonable and adequate and the investors tended to restore confidence in the market on the whole.
Q: The bill financing increased rapidly. Which factors led to its growth?
Zou Lan: In January 2019, the outstanding bankers’ acceptances stood at RMB 10.48 trillion, up 23.24% year-on-year; and the outstanding bill financing was RMB 6.3 trillion, up 60.6% year-on-year, accounting for 4.51% of the total loans, an increase of 1.32 percentage points year-on-year. In January, the growth of bill financing was rapid, due to the following factors:
Firstly, against the background of declining interest rate of bill financing, the enterprises were more willing to finance through bills.. Compared with loans and other means of financing, the bills, as an importance financing channel for small and medium-sized enterprises, feature short maturity, good convenience and liquidity. Meanwhile, the central bank discount policy enhanced the guidance and optimization of credit structure, and the bill supports to SMBs increased further. At present, over 60% of the enterprises using bill financing are micro, small and medium-sized businesses.
Secondly, the advantage of using bills to solve arrears was further highlighted. With the bill financing becoming more convenient and lower in cost, the bill exchange accelerated and numerous enterprises turned to solve the problems of arrears and capital turnover by issuing and transferring bills. According to the statistics, 62% of the issued bankers’ acceptances were from the micro, small and medium-sized businesses.
Thirdly, the fast growth of bill financing in January was in part seasonal. Based on data over years, the increment of bill business at the beginning of the year usually exceeds the annual average.
Q: How was the growth of corporate loans and what were the structural features of the capital use?
Ruan Jianhong: At present, the credit extension from banks to enterprises sped up remarkably compared to a year earlier. At the end of January, the outstanding RMB loans and foreign currency-denominated loans to enterprises and other entities stood at RMB 91.58 trillion, an increase of 10.7% year-on-year, up 0.8 and 1.8 percentage points compared to end-2018 and a year earlier respectively. In January, the loans to enterprises and other entities increased by RMB 2.56 trillion, up RMB 827.3 billion year-on-year. Among them, the short-term loans and bill financing increased by RMB 1.11 trillion, up RMB 710.8 billion year-on-year; the medium and long-term loans increased by RMB 1.39 trillion, up RMB 90.7 billion year-on-year. It was the first time for medium and long-term loans to grow at a faster pace on a year-on-year basis since August 2018.
In terms of sectors where medium and long-term loans go:
The medium and long-term loans to industrial sector grew steadily. At end-January, the outstanding medium and long-term loans to industrial sector grew by 7.3% year-on-year, flat compared with end-2018 and up 1.8 percentage points year-on-year.
The medium and long-term loans to the manufacturing sector grew at a notably accelerated pace, in particular, loans to the high-tech manufacturing sector maintained accelerated growth at a high level. At end-January, the outstanding medium and long-term loans to the manufacturing sector grew by 11.1% year-on-year, up 0.6 and 7.1 percentage points compared to end-2018 and a year earlier respectively.
Among them, the outstanding medium and long-term loans to the high-tech manufacturing sector increased by 37%, up 3.9 and 14 percentage points compared to end-2018 and a year earlier respectively, and 25.9 percentage points higher than the growth rate of loans to the manufacturing sector.
The growth of medium and long-term loans to service sector excluding the real estate sector picked up. At end-January, the outstanding medium and long-term loans to the service sector excluding the real estate sector increased by 9.9% year-on-year, up 0.5 percentage point compared to end-2018. In January, the medium and long-term loans to the service sector excluding the real estate sector increased by RMB 712 billion, accounting for 55% of the increment of medium and long-term loans to all sectors, up 6.4 percentage points year-on-year.
The growth of medium and long-term loans to the real estate sector continued to decline. At end-January, the outstanding medium and long-term loans to real estate sector increased by 22.8% year-on-year, down 1.2 percentage points compared to end-2018. In January, the increase of medium and long-term loans to the real estate sector accounted for 28.3% of the increment in all sectors, down 5.1 percentage points year-on-year.
Zhou Xuedong: The structure of corporate loans was upgrading and improving. In particular, the growth of loans to industrial and manufacturing sectors picked up, and the loans to high-tech manufacturing sector grew at a high speed with notably enhanced supports from the finance to the high-tech enterprises. All these are positive changes reflecting the achievements made in economic restructuring and supply-side structural reform. The medium and long-term loans to service sector excluding the real estate sector also increased. The growth of medium and long-term loans to real estate sector continued to decline to some extent.
Q: What was the reason for the change in “other assets” on the balance sheet of the central bank?
Ruan Jianhong: The “other assets” on the balance sheet of the central bank is the aggregation of asset items that are not listed separately, mainly some miscellaneous items, receivables and suspense payments. At the end of the year, many of these items would feature seasonal changes, and after that, the seasonal changes would weaken or vanish.
Q: Last month witnessed a notable growth of bills. And a view prevails in the market that some of the increment of bills was due to arbitrage. What’s your take on this phenomenon?
Zou Lan: It’s inevitable there are some individual arbitrage cases and we are paying close attention to them. In general, we believe the growth was attributed to the several factors mentioned above.
Q: As mentioned before, at present the liquidity is adequate and the market functions steadily. The data of inflation released today is rather low. Is there any possibility for interest rate cut?
Sun Guofeng: First of all, we shall pay more attention to the changes of real interest rates of loans. Since last year, the PBC has taken various monetary policies and measures to keep liquidity reasonable and adequate, thus a declining interest rate in the money market. In bond market, the yield of government bond, interest rate of corporate bonds and the rate of loans all declined. Especially in the last four months of 2018, the interest rate of loans remarkably decreased, and that of SMB loans declined in particular. As Director-general Ruan introduced, this trend maintained this January. So, the interest rate of loans from banks to enterprises you mentioned has been declining, so was the financing cost for enterprises. On the other hand, we have been promoting the market-based interest rate and the convergence of the benchmark rate and the market interest rate. We have talked about this on many occasions. When promoting the convergence of benchmark rate and the market interest rate for deposits and loans, we should give full play to the transmission effect of the PBC’s policy rate on the market rate and credit rate. In my opinion, given the actual effects and the process of market-based interest rate promotion, we can emphasize more on the changes of real interest rates of bank loans.
Q: The number of shadow banks increased in January. Will it continue to increase? Besides, the base of M1 in H1 2018 was not low, so will there be negative figures next month or in March? What impact it will have on the monetary policy?
Ruan Jianhong: First, I have to clarify one concept. Entrusted loans and trust loans are collectively called off-balance-sheet financing, not shadow banks. To me, your question was more about off-balance-sheet financing. For one thing, from the second half of 2017 to 2018, the off-balance-sheet financing fell rapidly due to the structural de-leveraging. From the trend of data, it’s estimated that the growth of off-balance-sheet financing will still be declining, but at a slower pace. For another thing, you asked about the relations between M1 and the enterprise’s demand deposits. Based on the survey and monitoring data on 5,000 enterprises, the liquidity for enterprises has not been deteriorated.
Sun Guofeng: I have one point to add. From the perspective of monetary policy, the M2 broad money supply and aggregate financing to the real economy (AFRE) are our major concerns. M2 is more closely related to the economic growth and prices in terms of relations between economic variables, and that’s why the PBC chooses M2 as the indicator for credit. M1 is an indicator for observation and we can also analyze the reason for its changes. But its relations with prices are not that stable, so none of the central banks around the world takes M1 as the intermediate goals for monetary policy. When we analyze M1, we do not tend to adjust monetary policy accordingly, but to observe M2 and AFRE.
Q: Yesterday, the General Office of the CPC Central Committee and the General Office of the State Council released the Several Opinions on Strengthening the Financial Services for Private Enterprises with many new measures and concepts. What important impacts it will have on strengthening the credit services in the future?
Zhou Xuedong: This document comprises 18 measures in five aspects. In our opinion, it aims at optimizing the credit structure and making the financial services to private enterprises more targeted and effective. The credit loan is an important means of loans for banks. However, to curb the excessive growth of non-performing loans (NPL), most banks hold the credit officers lifelong accountable for NPLs. The credit officers, therefore, are under great pressure. Once NPL occurs after loans are granted, they will face the pressure of lifelong accountability, so they will have concerns in loan extention. If the enterprise does not have enough assets for pledge, it would be hard to obtain loans. To enterprises, the credit officers are reluctant to issue loans to private enterprises and SMBs mainly because of the lack of collaterals. Hence, some scholars criticize that if this phenomenon continues, our banks will be more like pawn shops, or so-called “pawnized banks”. In this sense, the measures in this document were released very timely to properly rectify the situation. If NPLs occur, we shall differentiate whether the credit officer violated laws, regulations and disciplines, or seek personal gains. If the credit officer fulfilled the duty, he or she shall not be held accountable. Only in this way, will the officers be courageous to grant loans to private enterprises and SMBs. This document is rich in content and the financial authorities will earnestly implement it.
Please allow us to bring this conference to a close. Thank all the correspondents and three Director-generals.
