China Issues New Regulations for Lending

BEIJING, Feb. 23 -- China's banking industry watchdog has announced new regulations governing working capital loans and personal loans to ensure that loans benefit the economy and that credit is used for its stated purpose, sources reported.

The new regulations stipulate that working capital loans may not be used for investment purposes or speculating in equity markets.

The new regulations also help banks manage risk by covering areas such as investigation and risk evaluation, according to the China Banking Regulatory Commission. The new credit flow measures will ensure that funds are properly allocated and used.

New loans by Chinese banks last year amounted to RMB 9.6 trillion, which raised concerns about the pace of the country's lending. China is striving to keep the banking system under control this year.