January 12, 2016 / 4:19 AM / 4 years ago

Chinese banking regulator asks banks to reduce yields on wealth management products: sources

SHANGHAI/BEIJING (Reuters) - China’s banking regulator and the main bond clearinghouse have asked commercial banks to reduce yields offered on their wealth management products, five sources with direct knowledge of the matter told Reuters Tuesday.

Bank wealth management products, which are marketed by banks but often backed by risky third party assets including high interest loans or bonds, continue to offer yields of up to ten percent or higher, even though domestic benchmark interest rates and bond yields have fallen sharply over the past year.

The China Banking Regulatory Commission could not be reached for comment, while the Central Depository and Clearing Corporation declined to immediately comment.

Reporting by Li Zheng in Shanghai, Clark Li in Beijing, Zhao Hongmei in HONG KONG and Nathaniel Taplin

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