The central bank will not set up new policy banks to lend to small- and medium-sized enterprises (SME) and commercial banks will remain their main sources of funding, Wu Xiaoling, deputy governor of People's Bank of China, was quoted as saying.
The China Securities Journal quoted Wu as telling a financial forum that large companies have access to the stock and bond markets but commercial banks are the main source of SME financing.
As for the suggestion of establishing a government guarantee system for SME companies, the central bank official said that the government may support some industries using government revenues when necessary, but that small companies should not be dependent on government guarantees.
She suggested that amendments to bankruptcy and property laws would make commercial banks more willing to lend to SMEs.
Many SMEs complain that state banks show favouritism toward state companies, depriving them of access to bank credits.
