The standard of small loan company changing village and Town Bank will be promulgated

Zang, director of the CBRC's joint Financial Supervision Department, said in a seminar on the results of the "China Rural Finance Development research project" of HSBC-Tsinghua University 13th that the relevant regulations for small loan companies transformed into village banks will be introduced in the near future.　　This means that qualified microfinance companies will have access to financial licences in the future. Zang revealed that the basic conditions for the transformation is more than three years of business, two consecutive years of profit, and the structure of the loan must be small loans, to serve farmers, for small business services.　　According to the standard, there is no small loan company which meets the condition of the transformation. In May 2008, the central bank and the CBRC jointly issued guidance on microfinance companies, which stipulated that the balance of the microfinance companies ' access to funds from banking institutions should not exceed 50% of the net capital. Zang said the current ratio should not be higher. "Microfinance companies use capital to make loans, not loans from people's deposits, and if the proportion of bank financing expands, it is easy to pass on the risk of microfinance companies to banks." For the time being, half of the capital is used for experimental observation.　　Zang also disclosed that the central bank and the CBRC recently issued a directive on the subject, object and interest rate of microfinance, and delegated autonomy to the institutions, instead of unifying the requirements.　　Referring to the development of new rural financial institutions, Zang revealed that as of the end of March this year, the new rural financial institutions have been approved to set up a business to 114, these institutions to absorb 4.2 billion of shares, loans more than 6 billion, including farmers loans and small business loans accounted for 92%, to achieve the expected assumption. "In general, we have now preliminarily formed a commercial finance, policy-oriented financial and cooperative financial and other financial organizations as the main body of the rural financial organization system, the positioning of various financial institutions gradually clear, the function of continuous improvement, supporting the strong increase in agricultural strength," Zang said, by the end of 2008, The balance of agricultural loans of the national banking institutions reached 6.9 trillion, which accounted for 21.6% of the loan balances of all financial institutions and increased the proportion.　　In addition, the "28 phenomenon" has also improved. However, Zang also pointed out that rural finance sustainable development capacity is still inadequate.　　By the end of last year, the non-performing rate of agricultural loans of the national banking institutions was 13.1%, which was much higher than the average of 4.9% of the total non-performing loans of the national banking institutions, and the risk of agricultural loans was comparatively large. Zang pointed out that to continue to improve the rural financial system, accelerate the reform of the agricultural credit cooperatives. He revealed that the rural credit cooperatives in accordance with the principle of separation, the provincial government and the relationship between the rural credit cooperatives. The provincial Union must gradually transform itself into a financial enterprise which provides services to the county union, optimize the ownership structure according to the direction of shareholding system, and focus on solving the problem of decentralization of stock rights, instability of share capital and insider control.