PBOC: Credit supports require strengthening

The Chinese central bank governor urged commercial banks to strengthen credit supports to the real economy, and ensure GDP growth can stay within a reasonable range, according to a statement released on Tuesday.

Yi Gang, governor of the People's Bank of China, held a meeting with executives of financial institutions on Tuesday, analyzing the current monetary and credit situation.

Yi, who is also head of the Office of the Financial Stability and Development Committee under the State Council, highlighted the need to facilitate reduction of the real lending rate, using the newly-introduced loan prime rate as a guide to transform the loan pricing system.

Banks need to continually supplement capital in order to enhance the ability of issuing loans, according to the statement on the PBOC website.

The central bank will also enhance counter-cyclical adjustments to strengthen real economy growth through increasing credit supports, and the growth of broad money supply (M2) and total social financing should be in line with the nominal GDP growth rate, it said.

"The macroeconomy and financial growth still face challenges, and economic downward pressure is increasing with social credit contraction existing in some areas," the statement read.