CBRC: Bank reserve coverage to be 150% per year

Zhou Jingya in the first half of the new Yuan loan set a record of 7.37 trillion yuan, the regulator once again raised the demand for commercial banks to reserve coverage.　　On July 17, the Banking Regulatory Commission's third economic and financial situation briefing in 2009 said that financial institutions should strengthen risk management and strictly adhere to the bottom line of the provision of coverage, and must increase the provision coverage to over 150% during the year. This is the second time this year the CBRC has raised the requirement for commercial banks to set aside coverage. In January, Mr Liu called for at least 130% per cent of bank provisioning coverage at the CBRC's first economic and financial briefings in 2009.　　Higher-risk banks should focus more on creating conditions and further increase their provision coverage to more than 150% per cent. Allocation coverage is the ratio of loan loss preparation to non-performing loans, which mainly reflects the ability of commercial banks to compensate for loan losses and to prevent the loan risk.　　Mr Liu called on banking institutions to strengthen risk management to further optimize the credit structure. The reserve coverage of commercial banks has been increasing this year. At the end of March, domestic commercial banks had a coverage rate of 123.9%, up 7.5% from the beginning of the year.　　At the end of June, commercial banks ' allocation coverage reached 134.3%, up 17.9% from the beginning of the year, up 10.4% from the end of the first quarter. At the end of the quarter, 14 of the major commercial banks, only the Bank of China reserve coverage of 126.47%, did not reach 130%. The provision coverage of small and medium banks has reached a record high. Among the joint-stock banks, industrial bank, Pudong Hair Bank, China Merchants Bank and other allocation coverage ratio of more than 200%.　　and ICBC, Construction Bank, Bank of China, deep development did not meet the latest requirements of 150%. The quality of banking assets is also improving as the provision coverage rate increases.　　According to the CBRC's statistics, as at the end of June, the balance of non-performing loans in domestic commercial banks was 518.13 billion yuan, reduced by 42.18 billion yuan at the beginning of the year, and the non-performing loan rate was 1.77%, which was 0.65% lower than at the beginning of the year. Lianping, chief economist at Bank of Communications, said the general "double dip" meant that the economic downturn was almost over and the rally was clear. "The pressure on banks ' non-performing assets is relatively large in the one or two quarter and will be reduced in the three or four quarter. ”