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Chinese banks raise adequacy ratio
By Zhang Fengming |
November 5, 2010, Friday
|
Online Edition
Online Edition
BANKS in China have boosted their average capital adequacy ratio, the top banking regulator said today.
The average capital adequacy ratio for Chinese banks increased to 11.6 percent at the end of September, 0.5 percentage points more than the end of June, the China Banking Regulatory Commission said today.
The average on the tier-one, or core, capital adequacy ratio also gained 0.5 percentage points to 9.5 percent as September 30, the regulator said on its website.
Authorities have raised the bar for banks' capital requirement to cushion against possible rise of bad assets. The mishaps of the global financial crisis also pushed Chinese banking regulators to tight financial supervision.
Big-name banks mired in the global crisis managed to sail through the bumpy curve with the help of government bailout, leaving the "too big to fail" a buzz word as taxpayers and analysts criticized the lack of supervision on these heavyweights.
High leverage among Western banks was blamed for causing the global crisis and China will prevent the crash from happening on its land.
Against this backdrop, banks in China scrambled to raise capital through rights offer or initial public offering to replenish capital.
The average capital adequacy ratio for Chinese banks increased to 11.6 percent at the end of September, 0.5 percentage points more than the end of June, the China Banking Regulatory Commission said today.
The average on the tier-one, or core, capital adequacy ratio also gained 0.5 percentage points to 9.5 percent as September 30, the regulator said on its website.
Authorities have raised the bar for banks' capital requirement to cushion against possible rise of bad assets. The mishaps of the global financial crisis also pushed Chinese banking regulators to tight financial supervision.
Big-name banks mired in the global crisis managed to sail through the bumpy curve with the help of government bailout, leaving the "too big to fail" a buzz word as taxpayers and analysts criticized the lack of supervision on these heavyweights.
High leverage among Western banks was blamed for causing the global crisis and China will prevent the crash from happening on its land.
Against this backdrop, banks in China scrambled to raise capital through rights offer or initial public offering to replenish capital.
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