A report by an unidentified overseas accounting firm which said
that the bad loans of China's commercial banks had reached US$900
billion has been condemned by the People's Bank of China
Thursday.?
A Bank official said that the company had for a long time been
engaged in accounting and auditing business in China. The so called
research report had largely distorted the facts relating to the
capital quality of Chinese banks and drawn ridiculous conclusions,
he said.
China's national economy has maintained stable and rapid
development which was creating a healthy environment for the
financial sector, added the official.
He said the Chinese government has adopted measures to prevent
monetary risks including reforming financial mechanisms,
strengthening supervision, introducing more open policies and
establishing a modern enterprise system. By these means China's
financial industry had made remarkable progress in risk management
and the banks' capital quality had been improved.
According to the official, by the end of March this year, the
bad loan figure of China's commercial banks has been coming down.
The total volume of bad loans was 1312.47 billion yuan (US$164
billion), down 13.76 billion yuan compared with the beginning of
this year. The rate of bad loans was 8 percent which is down 0.6
percent compared with the beginning of this year.
(Xinhua News Agency May 12, 2006)