Chinanews.com, November 6th. Liu Guoqiang, deputy governor of the People’s Bank of China, said on the 6th that according to data from the People’s Bank of China and the China Banking and Insurance Regulatory Commission, the financial system in the first 10 months of this year adopted lower interest rates, deferred principal and interest payments for small, medium and micro enterprises, and inclusiveness. Two direct tools for small and micro credit loans, reduction of fees, support for corporate restructuring and debt-to-equity swaps, have already given away about 1.25 trillion yuan to the real economy.
It is estimated that the goal of 1.5 trillion yuan in profit distribution can be achieved throughout the year.
The Information Office of the State Council held a regular briefing on the State Council’s policies on the 6th. Relevant persons in charge introduced the progress of the implementation of reasonable profit distribution by financial institutions and answered reporters’ questions.
Liu Guoqiang introduced that since 2020, the People's Bank of China, the China Banking Regulatory Commission, and relevant departments have conscientiously implemented the decisions and arrangements of the Party Central Committee and the State Council, guided and urged financial institutions to increase their efforts to effectively support the development of the real economy.
First, the prudent monetary policy is more flexible and appropriate.
Comprehensive use of monetary policy tools such as RRR cuts, medium-term lending facilities, open market operations, refinancing, rediscounting, etc., to maintain reasonable and sufficient liquidity, and promote the overall market interest rate to stabilize and decrease.
The second is to continue to release the dividends of the LPR reform.
Guide the medium-term lending facilities and open market operations to lower the bid-winning interest rate by 0.3 percentage points, which led to a simultaneous decline in LPR and promoted a significant decline in corporate loan interest rates.
Started on schedule and successfully completed the centralized conversion of stock floating-rate loan pricing benchmarks at the end of August 2020, reducing interest payments on corporate stock loans.
The third is to use structural monetary policy tools to accurately drip irrigation.
In three batches, the re-loan and rediscount quotas were increased by 1.8 trillion yuan and gradually issued in place.
The phased deferment of debt and interest payment policy for small and micro enterprise loans and the inclusive small and micro credit loan support policy have accelerated the implementation of two monetary policy tools that directly reach the real economy, and direct support for small and micro enterprises has been further increased.
The fourth is to urge banks to reduce fees and make profits.
Standardize the charging behavior of credit, loan assistance, credit enhancement and assessment links, and urge banks to implement various policy requirements for fee reduction and profit concession, and actively transfer profits to the real economy.
The fifth is to support enterprises in restructuring and debt-to-equity swaps.
A considerable number of large enterprises and enterprise groups negotiated with banks, insurance, and trust institutions to request postponement, extension or restructuring of debts, extensions or reductions in principal and interest, and some special difficulties enterprises implemented bankruptcy and reorganization.
Liu Guoqiang pointed out that, on the whole, various measures have achieved remarkable results, and the quality and effectiveness of financial services to the real economy have continued to improve.
Reasonable growth of money and credit.
As of the end of September, the growth rates of broad money supply (M2) and the scale of social financing were 10.9% and 13.5%, respectively, 2.5 and 2.8 percentage points higher than the same period last year, significantly higher than the previous year.
The cost of financing has dropped significantly.
The corporate loan interest rate in September was 4.63%, a decrease of 0.61 percentage points year-on-year, and was at a historically low level.
Small and micro enterprise financing "increased in volume, expanded in coverage, and decreased in price."
As of the end of September, small and micro enterprise financing increased by 3 trillion yuan, an increase of 1.2 trillion yuan year-on-year; 31.28 million small and micro business entities were supported, an increase of 21.8% year-on-year; the average interest rate of newly issued inclusive small and micro business loans in September was 4.92 %, a decrease of 0.96 percentage points from December of the previous year.
He said that according to data from the People’s Bank of China and the China Banking and Insurance Regulatory Commission, the financial system used two direct tools, lower interest rates, deferred debt repayment for small, medium and micro enterprises, and inclusive small and micro credit loans to reduce fees and support corporate restructuring in the first 10 months of this year. Channels such as debt-to-equity swaps and debt-to-equity swaps have given away about 1.25 trillion yuan in profits to the real economy.
It is estimated that the goal of 1.5 trillion yuan in profit distribution can be achieved throughout the year.