2009-07-05

A brake on Chinese loan growth?

China to Order Investment Products Carried on Bank Balance Sheets
The China Banking Regulatory Commission is likely to compel banks to carry funds raised for wealth management on their balance sheets, the latest move signaling stricter regulation and monitoring of the business.

The balance sheet treatment is expected to result in banks holding more capital in reserve, restricting their ability to expand. The rule is likely to be announced this week.
A small change, but maybe the first step of many to curtail bank lending.

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