Some small- and medium- sized deposit-taking banks will need to keep more funds with the central bank following a lending binge at the start of the year, according to reports in the official China Securities Journal.
Without citing sources or giving details, the newspaper said the People’s Bank of China had tailor-made reserve ratios for various city commercial banks, reports Reuters. Bloomberg points out that it is unclear whether the ratio has risen or fallen. Given the general move to combat inflation in China, an overall tightening is likely, however.
The reserve ratio for smaller banks in China is about 15.5 per cent, after several rises since November last year; this time last year the ratio was 13.5 per cent. Larger banks have been subject to almost double the increase, with reserve ratios at about 19.5 per cent, up from 16 per cent at the start of last year.