China-IMF Report/PBOC

China's central bank defends financial system stability after IMF, World Bank assessments

  • English

Shotlist


FILE: Beijing, China - Date Unknown
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1. People's Bank of China (PBOC) headquarter

FILE: Date and location unknown
++MUTE++
2. Currency signs of Chinese yuan

FILE: China - Date and Exact Location Unknown
3. Various of RMB Business Center at bank
4. Various of yuan notes being counted

Beijing, China - Dec 7, 2017
++4:3++
5. SOUNDBITE (Chinese) Huang Yiping, central bank advisor (partially overlaid with shot 6):
"The PBOC has long been talking about releasing some regional risks, recognizing product defaults, and company bankruptcies, which essentially means that market rules should be followed more and more. That can actually improve our financial stability. Notably, We've been doing all of these since regulatory agencies started to guard against systematic financial risks."
++SHOT OVERLAYING SOUNDBITE++
FILE: China - Exact location and date unknown
++16:9++
6. Various of yuan notes being counted
++SHOT OVERLAYING SOUNDBITE++

FILE: Beijing, China - Jan 2016
7. Various of Bank of China headquarter

FILE: China - Exact location and date unknown
8. Various of customers being served at bank counters
9. Sign reading (Chinese/English): "Cash service"
10. Various of yuan notes going through cash counting machine
11. Agricultural Bank of China sign
12. China Construction Bank sign
13. Bank of Communications sign
14. Industrial and Commercial Bank of China sign
15. China Merchants Bank sign


Storyline


China's central bank Thursday expressed its confidence about the country's financial system stability, after the International Monetary Fund (IMF) and World Bank pointed out potential risks in the system in several assessment reports.

The People's Bank of China (PBOC) said the reports have fully acknowledged China's achievements in recent economic and financial reforms, but PBOC does not agree with some of the descriptions and views in the reports.

The descriptions of the stress testing did not fully reflect the outcomes of the test, according to a statement on the PBOC website.

The PBOC said under the severely adverse scenario during the stress testing, the common equity tier 1 ratios of the banks whose combined assets account for over 65 percent of the total commercial bank assets in China have remained seven percent and above, attesting to the strong resilience of the financial system.

Meanwhile, corporate profitability has improved this year, and local government borrowing has been backed by long-term cash-generating assets, making very limited room for any underestimation of non-performing loans (NPL) ratio, the central bank said.

The IMF reports recognized the significant efforts by PBOC and regulatory agencies to guard against risks and improve regulation and supervision. This year, China has already created a financial stability and development committee under the State Council to monitor systematic risks and prevent financial disruption.

"The PBOC has long been talking about releasing some regional risks, recognizing product defaults, and company bankruptcies, which essentially means that market rules should be strengthened. That can actually improve our financial stability. Notably, We’ve been doing all of these since regulatory agencies started to guard against systematic financial risks," said Huang Yiping, central bank advisor and Peking University professor.

The reports are part of the update of the China Financial Sector Assessment Program (FSAP). The IMF and World Bank launched the FSAP in 1999 to gauge the stability and soundness of the financial sector, the regulatory framework of member economies and financial sector's potential contribution to growth. China went through its first FSAP exercise in 2009-2011.

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  • ID : 8068095
  • Published : 2017-12-07 17:59
  • Last Modified : 2017-12-07 18:05:06
  • Location : Beijing,China
  • Category : economy, business and finance
  • Duration : 1'27
  • Audio Language : Chinese/Nats/Part Mute
  • Source : China Central Television (CCTV)
  • Restrictions : No access Chinese mainland
  • Version : 3
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