China achieves major progress in banking reform: regulator

China's top banking regulator said Wednesday in Beijing that the country has made "tremendous" progress in the reform of the banking industry characterized by a drastic dropin both the amount and ratio of non-performing loans.

Addressing a press conference of the State Council Information Office, Liu Mingkang, chairman of the China Banking Regulatory Commission said the banking industry is getting healthier during the ongoing macro-economic control.

At the end of September, the ratio of non-performing loans of China's major commercial banks dropped 4.39 percent from early this year, to 13.37 percent, while their core capital expanded to 787.3 billion yuan (95.1 billion US dollars) from 730.6 billion yuan (88.3 billion US dollars) at the beginning of the year.

The capital adequacy ratio of these banks rose by 2.23 percentage points on average. The ratio of the Big Four state-owned commercial banks increased by 1.9 percentage points, while that of smaller national share-holding banks grew by 2.8 percentage points.

Several foreign banks, including the Citigroup and Hong Kong and Shanghai Banking Corporation, have bought stakes of nine Chinese commercial banks and another nine Chinese banks are negotiating with potential foreign investors as China's banking sector has opened wider to the outside, said Liu.

Up to the end of October, 62 banks from the other parts of China had set up 204 business outlets in the Chinese mainland, among which 105 have been authorized to deal in Renminbi business.

Beginning Dec. 1, China will allow foreign banks to do Renminbibusiness in five more cities -- Kunming, Beijing, Xiamen, Xi'an and Shenyang,  bringing the total number of such cities to 18.

The inflow of foreign capital will help promote China's bankingreform and sharpen the competitive edge of Chinese banks, Liu said.

Source: Xinhua