BEIJING, June 6 China will further cut the
reserve requirement ratio (RRR) for some banks when appropriate,
the bank regulator said on Friday, just a week after the
government lowered the RRR for the second time in two months to
bolster economic growth.
The RRR, or the level of cash that commercial banks must
keep at the central bank, will be reduced for banks whose loans
to small businesses and the farm sector meet certain
requirements, the bank regulator said.
It did not say when the reduction would be made, nor did it
detail the criteria that would be used to judge whether banks
are eligible for less stringent reserve requirements.
"For banks and financial institutions where loan support for
small businesses and the farm sector meet a definite standard,
the RRR will be lowered as appropriate," the regulator said.
The remarks were made in a statement from the bank regulator
about what it would do in future to extend more financial
services to China's real economy.
Hit by unsteady global demand and slowing domestic
investment, China's stuttering economy grew at its slackest pace
in 18 months between January and March.
That has alarmed some experts who worry the slowdown may be
exacerbated by a cooling real estate market, thereby threatening
social stability by causing unemployment to spike.
Some investors speculate that China's authorities would
further loosen policy to shore up growth, such as reducing the
RRR across the board for all banks.
But policymakers have so far signalled that they are not
prepared to make any big policy moves, and have opted instead
for smaller measures that only stimulate activity in some parts
of the economy.
(Reporting by Koh Gui Qing and Shen Yan; Editing by Kim