China’s State-owned lenders helping finance work recovery of micro and small enterprises from the COVID-19 epidemic

Commercial banks have been ramping up support for small businesses to ensure stable employment and the development of market entities as China takes strong measures to fight COVID-19 and spur economic growth.

The Zhejiang provincial branch of Agricultural Bank of China Ltd, a large State-owned commercial lender, increased the amount of “inclusive loans”-loans to micro and small businesses with a total credit line of up to 10 million yuan ($1.45 million) per borrower-by 70 billion yuan during the first six months.

Apart from increasing inclusive loans, large State-owned commercial banks also significantly cut lending rates for small businesses after these banks were required to strengthen support for small businesses.

Before large banks began reaching out to these clients, city and rural commercial banks offered small business loans at average annual rates of more than 8 percent. By the end of June, however, the weighted average interest rate of one-year loans issued by Agricultural Bank of China’s Zhejiang branch to incorporated small businesses was around 4 percent, lower than the average lending rate of the overall banking sector, said Hu Yongzhong, general manager of the inclusive finance department at the branch.

Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like

The coronavirus won’t end moviegoing, but it could change it

New York (CNN Business)Last year was a good year for the film industry. The global box office brought in over $40 billion worldwide, even though the domestic box office was down. Disney notched seven films that made more than $1…

China’s freight volume continues to grow in October

BEIJING – China’s national freight volume, an indicator of economic activity, grew faster in October from a month earlier, signaling the country’s steady recovery from the COVID-19 fallout. The country’s freight volume has maintained positive growth for six consecutive months,…

U.S. existing home sales dive; prices still strong

WASHINGTON (Reuters) – U.S. home sales dropped by the most in nearly 4-1/2 years in March as extraordinary measures to control the spread of the novel coronavirus brought buyer traffic to a virtual standstill, supporting analysts’ views that the economy…

America becoming another banana republic – Max Keiser

Max also talks to Otavio ‘Tavi’ Costa, portfolio manager at Crescat Capital, about credit exhaustion among other things. They point out that the US Federal Reserve and other major central banks have a problem of maturing debt that they have…