BEIJING Aug 29 China's central bank said on
Friday it would cut reserve requirement ratios by 1 percentage
point for banks operating in areas hit by a recent earthquake in
the southwestern Yunnan province.
The central bank did not say how many banks will benefit
from the cut. Currently, big banks must hold 20 percent of their
deposit as reserve, while the ratio for some rural banks is as
low as 13 percent.
China has cut reserve ratios for selected banks this year
under the government's "targeted" policy stimulus to support the
The central bank will also cut interest rates on
farm-related re-lending in the quake-hit zone by 1 percentage
point, it added.
Qualified financial institutions will be allowed to issue
bonds to replenish their capital and companies will be allowed
to issue bonds to support the disaster relief efforts, it said.
Banks will be allowed to cut mortgage rates and the down
payment ratio for home buyers, the central bank said.
The earthquake earlier this month struck a remote part of
Yunnan - the latest incident in a temblor-prone region. The
epicentre of the quake was Longtoushan town in the province's
mountainous Ludian county.
(Reporting by China economics team; Editing by Anand Basu)