September 25, 2008 / 3:29 AM / 11 years ago

China, foreign banks say continuing to trade

SHANGHAI, Sept 25 (Reuters) - Major Chinese and foreign banks in China said on Thursday that they were continuing to trade with each other in the interbank money market, but that risk controls were reducing activity.

“We continue to conduct business as usual,” Citibank China, a unit of Citigroup (C.N), said in a statement.

It said the ratio of its loans to deposits in China remained “well under” the country’s regulatory requirement of 75 percent.

A spokeswoman for Bank of Communications (601328.SS), one of China’s five biggest banks, said it was continuing “normal” trade with foreign banks in the interbank market, although she said it would carefully monitor risks.

Traders at several other Chinese and foreign banks, who declined to be named because of the sensitivity of the issue, said U.S. and some other foreign banks were finding it more difficult to borrow money from the market because of concern about the health of the global financial system.

Some Chinese banks have temporarily stopped offering new lending to U.S. banks, in yuan and other currencies, three traders said.

However, they said foreign banks were not being excluded from trade completely and that the market was not panicking. (Reporting by George Chen and Lu Jianxin; Editing by Andrew Torchia and Ken Wills)

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