BEIJING Jan 16 China central bank said on
Thursday that it would tell banks to cut lending to poorly
managed local government financing firms while supporting those
that have sound management and risk controls.
"We will work together with related departments and local
governments to thoroughly clear up local government financing
vehicles with poor credibility, unclear functions and an
unsustainable financial situation," the People's Bank of China
said in a statement on its website, www.pbc.gov.cn.
The central bank will actively push forward preparations for
a municipal bond market and prudently experiment with mortgage
loans backed by rural land rights, it said.
(Reporting by China economics team; Editing by Ron Popeski)