China’s new chief banking regulator announced the expansion of debt-for-equity swaps and other measures to contain financial risk on Thursday in the face of the country’s growing pile of corporate debt.
The measures were announced during the first speech from Guo Shuqing as chair of the China Banking Regulatory Commission after being named to the post on Wednesday. He had previously been head of the securities regulatory commission four years ago and has been hailed by analysts as a “reform-minded” governor of Shandong province.
China’s banks have agreed to exchange a further Rmb400bn ($58bn) this year of corporate debt for equity stakes in those companies, Mr. Guo said during his first public conference on Thursday, adding that Rmb40bn of such swaps had already been completed this year.