China may allow small rural lenders, which are currently only allowed to issue loans, to restructure into village banks or lending companies, as the country moves further to improve financial services in rural areas.
Jiang Dingzhi, vice chairman of the China Banking Regulatory Commission, said yesterday that qualified small lenders in rural areas could restructure according to the requirements of the commission.
However, he did not offer details on the qualifications of the lenders or possible procedures involved.
Jiang also said the nationwide expansion of rural banks with both foreign and domestic capital should be carried out "steadily," telling local watchdogs to allow one or two financial institutions to begin trial operation in each province.
The CBRC announced earlier this month that it would extend its pilot project of building more rural financial institutions to all the country's regions.
Previously, only six provinces were included in the pilot program to allow foreign and domestic banking capital to invest in, buy or establish banking institutions in rural areas.
Jiang stressed that the new rural financial institutions should serve the agriculture sector, and he emphasized steady expansion to avoid an irrational boom.
So far, 23 rural financial institutions in the pilot areas have opened for business, including 11 village banks, four rural loan organizations and eight rural cooperative fund associations.