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SHANGHAI - CHINA'S central bank will lift limits on commercial bank loans to support stable and fast economic growth amid the global financial crisis, state media reported.
Beijing is adjusting its monetary policy along with other measures to minimise the impact of the worldwide slowdown, People's Bank of China (PBOC) spokesman Li Chao told the Xinhua news agency at the weekend.
'In order to tackle the impact of the spreading international financial crisis flexibly and effectively, and maintain the stable and rapid growth in China's economy, the central bank is no longer imposing hard restrictions on bank lending', Mr Li said.
The PBOC imposed strict loan controls last year and the first half of 2008 to rein in credit growth and prevent the economy from overheating.
But it has since eased its limits in order to help growth as China's economic expansion slowed to 9.9 per cent in the first three quarters of the year from 11.9 per cent in the whole of 2007.
The central bank cut key interest rates on Wednesday to spur economic growth, the third such move in six weeks.
The reduction, which came hours before similar moves by other central banks including the US Federal Reserve, was aimed at maintaining vitality in the economy, Mr Li said.
'In the current global crisis, central banks need coordination in policies,' he added.Mr Li also said the reserve requirement ratio, or the amount of money banks need to set aside, was left unchanged because there is ample liquidity in the country's banking system.
PBOC deputy governor Su Ning said it would implement a flexible and prudent monetary policy, according to remarks published in Monday's China Securities Journal, an official business newspaper. -- AFP
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