UPDATE 1-PRESS DIGEST - China - Feb 12

BEIJING/SHANGHAI, Feb 12 (Reuters) - Chinese newspapers available in Beijing and Shanghai carried the following stories on Thursday. Reuters has not checked the stories and does not vouch for their accuracy.

CHINA SECURITIES JOURNAL

-- The sharp rise in Chinese bank lending is not likely to continue in the long term, because it will have a decreasing effect in stimulating economic growth, analysts said. They noted that at least 50 percent of the huge January lending figure was in the form of discounted commercial paper, not direct, long-term loans to companies.

-- A China Insurance Regulatory Commission official said the commission would hold insurance company executives accountable and punish them if necessary this year as it enforced regulations.

-- Shareholders of Dongfang Electric Corp (600875.SS), which suffered major damage to its facilities in last May's earthquake, approved a 5.09 billion yuan ($745 million) plan to rebuild a plant. The plan would be financed by a 1.5 billion yuan capital injection by the government, 2 billion yuan of bank loans, and the company's own money.

SHANGHAI SECURITIES NEWS

-- Gemdale (600383.SS) said its real estate sales in January jumped 89 percent from a year earlier in terms of both area and value; it also said it would begin selling six projects in February and March.

-- Beijing Sanyuan Foods Co (600429.SS) is preparing a plan to buy assets of Sanlu group, the company at the centre of China's contaminated milk scandal, through a placement of new shares after Sanlu's creditors, who will meet today, reach agreement, a Sanyuan source said.

-- China Railway Construction Corp (601186.SS) said it had signed a $1.8 billion, three-year contract with the Saudi Arabian government to build and operate a light rail line in that country; the contract value is equivalent to about 6.8 percent of the company's 2007 turnover.

-- Injections of assets into listed companies by major shareholders has become an important contributor to their profits. Of listed companies which have already estimated net profit rises of at least 30 percent for 2008, half of them acquired assets from major shareholders last year.

FINANCIAL NEWS

-- China's State Council, or Cabinet, adopted a stimulus plan for the shipbuilding industry by increasing credit support for ship buyers. It also decided to extend the existing financial support policies until 2012, including tax rebates on key imported components for domestically owned ocean-going ships.

-- Some economists think China's economy would lead the world in recovery, but the country also faces potential risks. Deflation, a weak real estate market and declining exports could continue to hit the economy.

CHINA DAILY (www.chinadaily.com.cn)

-- Taiwan has been guaranteed direct access to the World Health Organization's (WHO) global health alerts. The mainland had consulted the WHO secretariat to make relevant arrangements to apply the International Health Regulations (IHR) to Taiwan.

-- The Central Military Commission (CMC) said a military parade to be held on Oct. 1 to mark the 60th anniversary of the founding of Communist China, would showcase the army's first-class organisation, weapons, training and high morale.