On January 12 the PBC announced it would raise the RMB reserve requirement ratio for deposit-taking financial institutions, with the exception of small financial institutions such as rural credit cooperatives, by 0.5 percentage points effective from 18 January 2010.
On January 13, the General Administration Department of the PBC issued the Notice (PBC General Administration Department Document No.5 [2010]) on stepping up financial supports to college-graduate village officers in their efforts to start up new firms in rural areas to benefit local people. The Notice calls for stronger guidance on credit policy and more innovative financial products and service modes tailored to local demands, so as to provide effective and timely financing support to those college-graduate village officers. In addition, the Notice calls for ad hoc monitoring over the use of funds.
On February 1 and 2, the 2010 meeting of the PBC on money and credit policy and the financial market was convened.
On February 3, the PBC reported to the Finance and Economy Committee of the National People s Congress on implementation of the monetary policy in 2009.
On February 11, the Monetary Policy Report for Q4 2009 was released.
On February 12, the PBC announced it would raise the RMB reserve requirement ratio for deposit-taking financial institutions, with the exception of small financial institutions such as rural credit cooperatives, by 0.5 percentage points effective from 25 February, 2010.
On March 4, the PBC convened a workshop on credit. It was pointed out at the meeting that, in line with the overall arrangements and requirements of macroeconomic management, efforts should be made to guide reasonable and balanced growth in the loan extensions of financial institutions, to optimize the credit structure, and to enhance awareness of risk prevention.
On March 8, the PBC issued the Provisional Administrative Measures on the Information Management System for Cross-border RMB Payments and Receipts (PBC Document No.79 [2010]) to reinforce management of information concerning cross-border RMB payments and receipts, to ensure secure, stable, and efficient operation of the information system, and to standardize the operation and use of the system by financial institutions.
On March 19, the PBC, in joint efforts with 8 ministries and commissions including the Publicity Department of the CPC Central Committee, released the Guiding Opinion on Extending Financial Support to Revitalize and Develop the Cultural Industry (PBC Document No.94 [2010]), urging financial institutions to take concrete measures and improve financial services to revitalize and develop the cultural industry.
On March 24, the PBC and the National Bank of the Republic of Belarus signed the Agreement on Bilateral Settlement in Local Currencies. This is the first time that China has signed an agreement in local currency settlement for transactions in general trade with a non-neighboring country and it represents a new step forward in promoting regional financial cooperation after implementation of the pilot program for RMB settlement of cross-border trade transactions. This development will promote economic cooperation between the two countries and will facilitate bilateral trade and investment.
On March 29, the PBC issued the Emergency Notice on Providing Financial Services for Agricultural Production in the Spring and for Disaster Relief in Drought-stricken Areas in Southwest China (PBC Document No. 100 [2010]) to urge stronger policy support to make sure that financial institutions have adequate liquidity to support agricultural production in the Spring and drought relief efforts with effective credits inputs.
On March 30, the Monetary Policy Committee of the PBC convened its regular meeting for Q1 2010.
On April 14, the People s Bank of China reported to the Finance and Economy Committee of the National People s Congress on the conduct of monetary policy in the first quarter of 2010.
On April 21, the People s Bank of China, jointly with the China Banking Regulatory Commission, the China Securities Regulatory Commission and the China Insurance Regulatory Commission, issued the Emergency Notice on Financial Services in the Areas Affected by the Yushu Earthquake (PBC Document No.121 [2010]). The Notice stipulates that greater efforts should be made to strengthen cash deployment and supply, to make sure the payment and clearing system and the treasury system perform properly, and guide financial institutions to earnestly step up their credit support for disaster relief and post-quake reconstruction so as to meet the basic living requirements of affected people in the quake areas.
On May 2, the People s Bank of China decided to raise the RMB reserve requirement ratio for depository financial institutions by 0.5 percentage points, effective from May 10, 2010. Rural credit cooperatives and village and township banks were temporarily exempted from the ratio hike.
On May 10, the China Monetary Policy Report for Q1, 2010 was released.
On May 19, the People s Bank of China, jointly with the China Banking Regulatory Commission, the China Securities Regulatory Commission, and the China Insurance Regulatory Commission, issued the Guiding Opinions on Comprehensively Promoting Innovation of Financial Products and Service in Rural Areas (PBC Document No.198 [2010]). The Opinions called for innovation in financial products and services and widespread introduction of financial products in rural areas that have been proven successful. The Opinions required that, according to the new situation of rural development, efforts should be made to innovate and launch new financial products tailored to actual demands of the rural areas and farmers, to rejuvenate the financial services mode through the improvement of rural financial services process, so as to extend convenient, quality and modern financial services to the vast rural areas and farmers.
On May 28, the People s Bank of China, jointly with the China Banking Regulatory Commission, issued the Opinions on Provision of Financial Services to Support Energy Conservation and Emission Reduction and Eliminate Outdated Production Capacity. The Opinions urged financial institutions to improve credit management and financial services in a comprehensive manner and closely monitor and prevent credit risks, so as to support energy conservation and emission reduction.
On June 8, the China Regional Financial Sector Operation Report (2009) was issued.
On June 9, authorized by the State Council, the People s Bank of China and the Central Bank of Iceland established a bilateral local currency swap arrangement with an amount of 3.5 billion yuan, in order to promote bilateral trade and investment and strengthen financial cooperation.
On June 19, in view of the recent economic situation and financial market developments at home and abroad and the balance of payments situation in China, the People s Bank of China decide to further reform the RMB exchange rate regime and enhance the RMB exchange rate flexibility. In furthering reform of the RMB exchange rate regime, continued emphasis would be placed to reflecting market supply and demand with reference to a basket of currencies. The exchange rate floating band would remain the same as previously announced on the interbank foreign exchange market.
On June 21, the People s Bank of China, jointly with the China Banking Regulatory Commission, the China Securities Regulatory Commission, and the China Insurance Regulatory Commission, released the Opinions on Further Improving Financial Services to Small- and Medium-sized Enterprises (PBC Document No. 193 [2010]). The Opinions sought to enhance reform and innovation of the SMEs credit management system, improve the multi-layered financial organization system for SMEs financial services, expand the financing channels in line with the characteristics of SMEs, develop a credit-enhancing system for SMEs, and support SMEs efforts in going abroad by a variety of means.
On June 22, the People s Bank of China, with joint efforts of the Ministry of Finance, the Ministry of Commerce, the General Administration of Customs, the State Administration of Taxation, and the China Banking Regulatory Commission, released the Notice on Expansion of the Pilot Renminbi Settlement of Cross-border Trade Program. The Notice expanded the pilot cross-border renminbi trade settlement program, by increasing the domestic pilot cross-border renminbi trade settlement areas and eliminating geographical limitation to overseas trading partners. The pilot cross-border renminbi settlement business was expanded from trade in goods to other BOP items. The expanded pilot cross-border renminbi trade settlement program would further meet the practical demands of enterprises for cross-border trade settlement in yuan, and would enhance the role of the program.
On July 7, the Monetary Policy Committee of the PBC held its second quarterly meeting of 2010.
On July 15, the PBC reported to the Finance and Economy Committee of the National People s Congress on the conduct of monetary policy in the first half of 2010.
On July 23, the People s Bank of China and the Monetary Authority of Singapore signed a a bilateral local currency swap agreement with an amount of 150 billion yuan, or about S$30 billion, to promote bilateral trade and direct investment.
On July 26, the PBC, jointly with the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Finance, the State Administration of Taxation, and the China Securities Regulatory Commission, released the Several Opinions on Promoting Gold Market Development (PBC Document [2010] No.211), highlighting the roadmap and main tasks to be finished in gold market development.
On July 30, the Ministry of Finance, the National Development and Reform Commission, the People s Bank of China, and the China Banking regulatory Commission, jointly released the Circular on Implementing the Notice of the State Council on Strengthening Management of Financing Platform Companies Established by Local Governments (Budget Department Document No.412 [2010]). The Circular clarified some contents of the Notice of the State Council on Strengthening Management of Financing Platform Companies Established by Local Governments (State Council Document No.19 [2010]), and required local governments to report results of local financing platform companies.
On August 5, the China Monetary Policy Report, Quarter 2, 2010, was released.
On August 15, the PBC, jointly with the China Banking Regulatory Commission, released the Guidance on Making all-out Efforts to Render Financial Support and Services to Areas hit by the Catastrophic Mudslide in Gansu and Sichuan Provinces (PBC Document No.226 [2010]).The Guidance urged that efforts should be made to implement the policies on deferred repayments of housing reconstruction loans extended before the disaster, to apply preferential credit policy on housing loans, to strengthen credit management, to increase central bank loans to support the agricultural sector, and to facilitate resumption of financial services in the disaster-hit areas.
On August 16, the PBC issued the Notice on a Pilot Scheme for Three Kinds of Eligible Institutions Outside the Mainland to Invest in China s Inter-bank Bond Market (PBC Document [2010] No. 217). Under the pilot program, foreign central banks and monetary authorities, the RMB clearing bank in Hong Kong and Macao and participating banks outside Mainland China can make use of their RMB funds to invest in the Mainland s inter-bank bond market.
On August 30, the 19th regular meeting of the committee that reviews the redemption of special central bank notes under the pilot program initiated by the PBC for the reform of rural credit cooperatives (RCCs) decided to redeem central bank notes issued to RCCs in Xide and other 26 counties and county-level cities in 8 provinces/autonomous regions, including Sichuan Province, with a total quota of 961 million yuan.
On September 2, the PBC issued the Administrative Rules on Opening RMB Bank Settlement Accounts by Overseas Institutions (PBC Document No.249[2010]), which stipulated that overseas institutions can apply to open RMB bank settlement accounts with commercial banks to conduct cross-border RMB businesses in accordance with laws. The Rules entered into force on October 1, 2010.
On September 21, the PBC, jointly with China Banking Regulatory Commission, China Securities Regulatory Commission and China Insurance Regulatory Commission, released the Guidance on Further Providing Financial Support and Services to Post-Quake Reconstruction in the Areas Hit by the Wenchuan Earthquake (PBC Document No. 271[2010]). The Guidance emphasized the efforts should be made to maintain the continuity and stability of financial support policies to quake-hit areas, and to further increase the targeting and effectiveness of financial support policies.
On September 28, the Monetary Policy Committee of the PBC held its third quarterly meeting of 2010.
On September 29, in order to further implement the Notice of the State Council on Resolutely Curbing the Excessive Hike of Housing Prices in Some Cities (State Council Document No.10[2010]), consolidate the achievements of macro- management on the real estate market, and promote the healthy development of the real estate market, the PBC, jointly with the China Banking Regulatory Commission, released the Notice on Issues Regarding Improving Differentiated Housing Credit Policies(PBC Document [2010] No. 275). The Notice urged commercial banks to more rigorously implement policies on down payment for the purchase of commercial housing and interest rate of mortgage loans, clarified policies on moratorium of mortgage loans to the purchase of third or more home, to resolutely curb speculative activities in the real estate market. In the meantime, the Notice also required commercial banks to continue to meet the loan demand of indemnificatory housing projects, and to support middle and lower-price housing projects and middle and small-sized home projects, so as to guide the healthy development of the real estate market.
On September 30, the CSRC, the PBC and the CBRC jointly issued the Circular on Issues Concerning Pilot Participation of Public Company Commercial Banks in Bond Trading on Stock Exchanges (CSRC Document No. 91 [2010]).
On October 14, the PBC reported to the Finance and Economy Committee of the National People s Congress on implementation of the monetary policy in the first three quarters of 2010.
On October 20, the PBC decided to raise RMB benchmark deposit and loan rates of financial institutions as of Oct. 20, 2010. The one-year benchmark deposit rate was raised from the current level of 2.25 percent to 2.50 percent, up 0.25 percentage points. The one-year benchmark loan rate was raised from the current 5.31 percent to 5.56 percent, up 0.25 percentage points. Benchmark rates on deposits and loans of other maturities were adjusted correspondingly.
On November 2, the Monetary Policy Report for Q3 2010 was released.
On November 9, in order to prevent financial risks resulting from cross-border flow of funds, the SAFE issued the Notice on Strengthening Administration of the Foreign Exchange Business (SAFE Document No. 59 [2010]).
On November 10, the PBC decided to raise the RMB reserve requirement ratio for depository financial institutions by 0.5 percentage points, effective from Nov. 16, 2010.
On November 11, the PBC issued the Notice on Follow-up Monitoring and Appraisal of Redemption of Special Central Bank Notes under the Pilot Program Initiated by the PBC for the Reform of Rural Credit Cooperatives(RCC). The Notice required that branch offices of the PBC earnestly carry out follow-up monitoring and examination of redemption of special central bank notes, accurately grasp the focus of the appraisal work, adhere to the principle of combining incentives with constraints, put into full play of the role of monetary policy instruments and financial market access policies, promote rural credit cooperatives to consolidate fruits of preliminary reform, strengthen rural credit cooperatives capacity for sustainable development, and improve financial services in rural areas.
On November 19, the PBC decided to raise the RMB reserve requirement ratio for depository financial institutions by 0.5 percentage points, effective from Nov. 29, 2010.
On November 22, in order to promote the China-Russia trade, facilitate the conduct of cross-border trade settlement in RMB, meet the demands of economic agents to reduce exchange costs, the China Foreign Exchange Trade System, under the authorization of the PBC, launched the direct trading of the Russian ruble with the RMB on the interbank foreign exchange market. On Dec. 15, 2010, the Russian Moscow Interbank Currency Exchange (MICEX) formally launched the trading of the RMB against the ruble on its market.
On November 23, the PBC convened a workshop on credit. The meeting analyzed the current economic, financial, money and credit situations, guided financial institutions to keep reasonable growth of loans, further optimize the credit structure and improve their capacity in risk prevention.
On December 10, the PBC decided to raise the RMB reserve requirement ratio for depository financial institutions by 0.5 percentage points, effective from Dec. 20, 2010.
On December 13, the closing time of the interbank foreign exchange market was adjusted to 16:30.
On December 15, the PBC convened a workshop on credit. The meeting conveyed the spirits of the CPC Central Economic Work Conference, guided financial institutions to carry out the prudent monetary policy, adjust their credit structure on their own, maintain the reasonable growth of loans, and strengthen their capacity in risk prevention, in line with requirements of the macro-prudential regulation.
On December 24, the Monetary Policy Committee of the PBC convened its regular meeting for Q4 2010.
On December 26, the PBC decided to raise RMB benchmark deposit and loan rates of financial institutions as of Dec. 26, 2010. The one-year benchmark deposit rate was raised by 0.25 percentage points, from 2.50 percent to 2.75 percent. The one-year benchmark loan rate was raised from 5.56 percent to 5.81 percent, up 0.25 percent points. Benchmark rates on deposits and loans of other maturities were adjusted correspondingly. At the same time, lending rates of the PBC to financial institutions were also increased. In particular, the one-year central bank liquidity lending rate was raised from 3.33 percent to 3.85 percent, the one-year central bank loan rate to rural credit cooperatives was raised from 2.88 percent to 3.35 percent, and the central bank rediscount rate was raised from 1.80 percent to 2.25 percent.
