China Calls Financial Institutions to «Sacrifice» Profits This Year
Chinese Premier Li Keqiang called on the nation’s financial system to make sacrifices to stabilize the economy.
Chinese officials asked financial institutions to forego up to $1.5 trillion yuan ($212 billion) of profits to support the economy. The comments were made during a State Council meeting, according to state television, which included calls for lower lending rates, service fee cuts and loan payment deferrals. Chinese commercial banks generated $2 trillion yuan ($282 billion) of net profit in 2019, as per official data.
According to a «Caixin» report citing an unnamed source close to the council, measures to be expected include borrowing cost cuts for new and existing loans.
In addition to an ongoing pandemic and U.S.-China trade war, the world’s second-largest economy is reportedly facing other serious humanitarian challenges including a second coronavirus wave that has reportedly led one Beijing district official to describe his area as being in «wartime emergency mode»; and a major flood that has affected 11 provinces.
