"For various risk issues, the China Banking and Insurance Regulatory Commission has always adhered to the principles of marketization and rule of law to supervise and deal with. At present, the overall risk of the banking and insurance industry is under control." On July 14, China Banking and Insurance Regulatory Commission Deputy Director and Press Spokesperson Zhang Zhongning Said at a press conference of the State Council Information Office.

In terms of the disposal of non-performing assets, in 2020, the bank's disposal of non-performing assets will reach 3.02 trillion yuan, which is the largest year of disposal of non-performing assets in the banking industry in history. In the first quarter of this year, the disposal of non-performing assets was 482.7 billion yuan, exceeding the level of the same period last year. Liu Zhongrui, deputy director of the Information Department of the China Banking and Insurance Regulatory Commission, said that the first half of this year is expected to be higher than the same period last year.

Liu Zhongrui said that the credit risk of the banking industry is generally controllable, and the debt level is generally stable, and there is no tension in the overall debt system.

Yield rate remains at a reasonable level

Liu Zhongrui introduced that at present, the credit risk of the banking industry is generally controllable. At the end of June, the non-performing loan ratio of the banking industry was 1.86%, maintaining a reasonable level. Due to increased efforts to dispose of non-performing loans, the non-performing loan ratio decreased from the beginning of the year. At the end of June, the ratio of loans overdue by commercial banks for more than 90 days to non-performing loans was 79.6%, which was significantly lower than 100%. Some more prudent banks include all loans overdue for more than 60 days into non-performing loans.

At the same time, the China Banking and Insurance Regulatory Commission instructed banks to increase provisioning and disposition of non-performing assets in a forward-looking manner, dispose of risks as early as possible, and make more room for risk response.

In addition, the Banking and Insurance Regulatory Commission adopted a number of financial support policies such as deferred repayment of principal and interest, reduction of fees and profits, etc., which are conducive to stabilizing business conditions and cash flow of enterprises, helping a large number of enterprises to overcome difficulties, resume production, and mitigate risks. The gradual recovery of operations has played a key role in stabilizing bank credit quality.

Of course, Liu Zhongrui also said that with the expiration of the deferred debt service policy, non-performing loans will still face upward pressure in the future. In this regard, the China Banking and Insurance Regulatory Commission has conducted in-depth research and judgment on risks, grasped the risk base, and guided banks to prudently operate and strengthen risk control. Supervise banks to adopt the expected credit loss method in accordance with the principle of substance over form, fully assess risks, classify real assets, and make full provisions. Encourage banks to make overall plans to deal with the rebound of non-performing loans, and effectively use cash collection, write-off, and batch transfers to further increase the disposal of non-performing loans. Support banks to replenish capital through multiple channels to enhance their ability to withstand risks.

Controllable banking liquidity risk

When asked about the debt situation of the banking system, Liu Zhongrui said that the current level of debt in the banking industry is generally stable, liquidity risks are controllable, and there is no tension in the overall debt system.

Liu Zhongrui gave the following data to explain in detail: As of the end of June, the total liabilities of the banking industry have increased by 9.1% year-on-year, maintaining a reasonable level. The current liquidity coverage ratio of commercial banks is 136.7%, the liquidity matching ratio is 152.6%, and the core debt dependency ratio is 64.7%, all of which meet the regulatory requirements as a whole. The market liquidity remains reasonable and abundant, and the inter-bank market interest rate is in a reasonable range, which can meet the needs of banks to maintain stable debt.

Since last year, in order to support the economic recovery and development, the banking industry has increased its credit allocation, focusing on supporting private, small and micro enterprises and other fields. In 2020, various loans increased by 13.3% year-on-year, and the growth rate was significantly faster than that of deposits, leading to an increase in the loan-to-deposit ratio. Liu Zhongrui explained that under certain circumstances, the loan-to-deposit ratio has risen in stages, which to a certain extent reflects the strengthening of financial support for the real economy. Since the beginning of this year, with the gradual recovery of the economy, loan growth has stabilized, and the rising trend of loan-to-deposit ratio has eased. As of the end of June, the RMB loan-to-deposit ratio of commercial banks was 78.1%, an increase of 1.3 percentage points from the beginning of the year and a decrease of 0.9 percentage points from the previous month.

Liu Zhongrui emphasized that the China Banking and Insurance Regulatory Commission attaches great importance to bank debt stability and liquidity risk prevention and control, and recently issued and implemented the "Commercial Bank Liability Quality Management Measures" to promote commercial banks to strengthen debt business management, expand debt sources, optimize debt structure, and enhance bank debt Matching degree with assets in terms of maturity, currency, interest rate, exchange rate, etc. These measures are conducive to further enhancing the stability of bank liabilities and proactively preventing liquidity risks. At the same time, the supervisory authority also instructs banks to regularly carry out stress tests on changes in liabilities, design scenarios for various possible liability losses, formulate and improve response plans based on test conditions, and effectively prevent liquidity risks.