New rules for commercial banks, more accurately reflecting market liquidity, were revealed by China's central bank.

 

Monies held by commercial banks on behalf of non-deposit-taking financial institutions will now be calculated as regular deposits, while the lending to these institutions will be considered regular loans, according to a notice released by the People's Bank of China.

 

Lending of commercial banks to financial leasing companies will also be reckoned as regular lending.

 

"The changes will more accurately reflect overall lending and deposit figures and liquidity conditions," said Sheng Songcheng, director of surveys and statistics at the central bank, "making the calculation more accurate and monetary policy more effective."

 

"This adjustment will not affect China's reserve requirement system," Sheng said. 

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