Chinese banks must meet financing needs for coal and electricity – regulator
BEIJING, Oct.5 (Reuters) – China’s banking regulator said on Tuesday that lenders, including strategic banks, must ensure that the financing needs of the coal and power sectors are met so that the heating of consumers during the winter is not affected.
Beijing is rushing to deliver more coal to utilities to restore supply as nearly two-thirds of provinces grapple with power rationing. Officials say the power supply situation remains difficult. Read more
“We must encourage banking and insurance institutions to actively cooperate with local governments and support the major coal-producing regions and major coal enterprises of Shanxi, Shaanxi, Inner Mongolia and Xinjiang in order to increase the ‘electricity and coal supply,’ said China Banking and Insurance. Regulatory Commission (CBIRC) said in a statement.
But the funds should not be used to speculate and profit on bulk commodities such as coal, steel and non-ferrous metals, the CBIRC warned.
It is also strictly forbidden to withdraw or cut loans to coal-fired power plants, coal mines and other businesses and projects that meet the requirements, in a “one-size-fits-all” approach, the regulator said.
Short-term coal supplies could also come under further pressure as bad weather disrupts production.
In Shanxi, the northern province closed 27 coal mines on Monday due to flooding caused by heavy rains, the provincial government said in a statement on Tuesday.
Reporting by Ryan Woo and Kevin Huang; Edited by Christian Schmollinger
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