China's banking regulator said Wednesday it would soon send teams to investigate commercial bank loans to the iron and steel, aluminum and cement industries, in a hope to curb possible excessive investment and financial problems.
The probe would also cover the lending to office buildings and training centers belonging to the government departments, fast rail traffic systems in urban areas, golf courses and logistics, convention and shopping centers, as well as new projects beginning construction in 2004, the China Banking Regulatory Commission (CBRC) said.
And the CBRC teams plan to launch a special investigation into loans extended by some state-owned banks that support auto consumption.
A spokesman for the commission said that China's economy stayed on the track of fast growth with efficiency being further raised, but some contradictions in the economic picture were becoming "more apparent", reflected by excess and rush investment, copy-cat and low-level construction, picking-up money and credit growth and creeping-up commodity prices.
So, all banking institutions should upgrade internal control and rein in loans stringently to safeguard the safety of financial assets and support the healthy growth of the economy, said the spokesman.
The world's sixth biggest economy -- expanding a sizzling 9.8 percent in the first quarter of the year -- is gradually beginning to respond to repeated attempts by the Chinese government to tap the brakes on excess investment, largely propped up by bank loans.
Official figures say that investment in construction and factory equipment among other fixed assets, contributing greatly to the country's overheating economy, slowed its pace -- down 8.8 percentage points from March to an annualized growth of 34.7 percent in April.
The new CBRC investigation order that aims to ensure further lower growth of loans applies to some policy banks, all commercial banks, rural and urban credit cooperatives, trust investment companies and financial companies around the country.
(Xinhua News Agency May 27, 2004)
