Read in Chinese

Speakers:

Mr. Xiao Yuanqi, vice minister of the National Financial Regulatory Administration (NFRA)

Mr. Wang Shengbang, director of the Legal and Regulation Department at the NFRA 

Ms. Liao Yuanyuan, director of the Statistics and Risk Surveillance Department at the NFRA 

Mr. Yin Jiang'ao, director of the Property and Casualty Insurance Supervision Department at the NFRA 

Chairperson:

Ms. Xing Huina, deputy director general of the Press Bureau of the State Council Information Office (SCIO) and spokesperson of the SCIO

Date:

Aug. 21, 2024

Xing Huina:

Ladies and gentlemen, good afternoon. Welcome to this press conference held by the State Council Information Office (SCIO), as part of the series "Promoting High-Quality Development." Today, we have invited Mr. Xiao Yuanqi, vice minister of the National Financial Regulatory Administration (NFRA), to brief you on relevant developments and to take your questions. Also present today are Mr. Wang Shengbang, director of the Legal and Regulation Department at the NFRA; Ms. Liao Yuanyuan, director of the Statistics and Risk Surveillance Department at the NFRA; and Mr. Yin Jiang'ao, director of the Property and Casualty Insurance Supervision Department at the NFRA. 

Now, I'll give the floor to Mr. Xiao for his introduction. 

Xiao Yuanqi:

Thank you. Good afternoon. I'm very pleased to meet with you again to introduce the progress of the NFRA in promoting high-quality development. On behalf of the NFRA, I would first like to express our gratitude to friends from the media for your strong support, attention and assistance toward the financial work and financial supervision. My colleagues and I are all very willing to answer your questions.

Under the strong leadership of the Party Central Committee with Comrade Xi Jinping at its core, the NFRA has fully embraced the political and people-oriented nature of financial work. We have promoted high-quality financial development to contribute to the building of a strong nation and the great rejuvenation of the Chinese nation. China has established a multi-tiered, broad and diversified financial institution system. The banking sector now ranks first globally in terms of size of assets, while the insurance market ranks second in the world. Since the beginning of this year, the NFRA has thoroughly implemented the guiding principles of the 20th National Congress of the Communist Party of China (CPC), as well as the second and third plenary sessions of the 20th CPC Central Committee, the Central Financial Work Conference, and the Central Economic Work Conference. We have adhered to the general principle of pursuing progress while ensuring stability, fully and faithfully applied the new development philosophy on all fronts, and focused on the major decisions and deployments of the Party Central Committee and the State Council, achieving new results in promoting high-quality development.

We have remained committed to deepening supply-side structural reform in the financial sector, and guiding financial institutions to adopt the right perspectives on performance and development, focus on their core responsibilities, enhance their capabilities, and transition toward more refined internal management, thereby promoting high-quality and sustainable industry development. I would like to share a few key figures with you: Asset growth has remained stable. As of the end of July, the total assets of banking financial institutions reached 423.8 trillion yuan, marking a year-on-year increase of 7%. The insurance industry's total assets stood at 33.9 trillion yuan, up 7.7% from the beginning of the year. Asset quality has remained stable, with the non-performing loan (NPL) ratio continuing to decline steadily. This year, credit risks have been generally under control. By the end of July, the NPL ratio of the banking sector was 1.61%, down 0.08 percentage point from the same period last year. The disposal of non-performing assets has also intensified, with banks disposing of 1.4 trillion yuan of non-performing assets in the first half of this year. Risk buffers have steadily increased. As of the end of July, the loan loss provision coverage ratio of banks was 216.7%, meaning that loan loss provisions were more than double NPLs. Additionally, by the end of the first half of this year, the capital adequacy ratio of banks stood at 15.53%, while the comprehensive and core solvency ratios of insurance companies were 195.5% and 132.4%, respectively, indicating that banks and insurance institutions are well-equipped to withstand risks. Liquidity has been improving steadily. The two main liquidity indicators for banks, the liquidity coverage ratio and the net stable funding ratio, both meet regulatory requirements. Therefore, China's banking industry is currently stable and improving, with controllable risks and key business and regulatory indicators within healthy and reasonable ranges.

Financial institutions have further enhanced their ability to serve the real economy, with a continued increase in financial supply, particularly for major strategies, key areas and weak links, becoming more precise and efficient. The total deposit balances held by all financial institutions has maintained steady growth. By the end of July, the balance of RMB loans reached 251 trillion yuan, an increase of 13.5 trillion yuan compared to the beginning of the year. The balance of bond investments by banking and insurance institutions stood at 103 trillion yuan, up 4.9 trillion yuan compared to the beginning of the year. The insurance fund investment balance stood at 31 trillion yuan, a rise of 7.4% compared with that at the beginning of 2024. These numbers reflect the supply side of financial funds. Moreover, the funding structure has been optimized. We have intensified our support for the advanced manufacturing and sci-tech innovation sectors. By the end of July, loans to the manufacturing sector rose 11.4% year on year, and loans to the high-tech industry increased by 13.9% year on year. In addition, financial services for micro and small enterprises, as well as for agriculture, rural areas and rural residents, have also improved. Inclusive finance lending to micro and small businesses rose 17.1% year on year by the end of July. Support for the health industry and silver economy has been strengthened. By the end of July, loans to the elderly care sector were up 16.1% compared to the beginning of the year. To support the in-depth integration of the digital economy with the real economy, loans to core industries of the digital economy increased 12.4% year on year. The insurance industry played an important role in the rapid recovery of life and work after disasters, providing effective coverage for damage caused by rainstorms, floods and other calamities. In the first seven months, insurance companies paid out a total of 1.39 trillion yuan in claims and benefits, a 30.2% year-on-year increase. By the end of July, the insurance industry provided financing support totaling 28.5 trillion yuan through bonds, stocks, and other means. These are some key figures I'd like to share.

In accordance with the decisions and arrangements made by the CPC Central Committee, we have constantly improved financial regulatory systems and mechanisms. As a result, the building of regulatory systems has accelerated comprehensively, regulatory and law enforcement capabilities have been strengthened, and financial regulation has become more digitalized and smarter.

Currently, the NFRA is earnestly studying the guiding principles of the third plenary session of the 20th CPC Central Committee. We follow the guidance of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, acquiring a deep understanding of the decisive significance of establishing Comrade Xi Jinping's core position on the Party Central Committee and in the Party as a whole and establishing the guiding role of Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era. We will continue to uphold Comrade Xi Jinping's core position on the Party Central Committee and in the Party as a whole and uphold the Central Committee's authority and its centralized, unified leadership. We will further align our thinking and actions with the guiding principles of the third plenary session of the 20th CPC Central Committee, ensuring that the principles, policies, decisions and arrangements related to financial work made by the Party Central Committee are thoroughly implemented. We will focus on further deepening reform comprehensively with a view to advancing Chinese modernization. We will celebrate the 75th anniversary of the founding of the People's Republic of China with our remarkable contributions.

That's all for my introduction. We would like to answer your questions now. Thank you.