Potential of rural China financial market revealed

Assets at small and medium-sized financial institutions in rural China amounted to US$788.07 billion (RMB5.6 trillion) as at the end of last year, the China Securities Journal reported, citing Liu Mingkang, director of the China Banking Regulatory Commission. Loans worth a combined US$168.87 billion (RMB1.2 trillion) were issued to 32.8% of the rural population, or 300 million farmers, last year. Liu predicted the amount of loans would grow 15% a year until 2010. He also said the non-performing loan ratio in rural areas would be reduced to 10% by then. At the end of last month, David Miliband, UK Secretary of State for Foreign and Commonwealth Affairs, signed a memorandum of understanding on urban-rural coordinated development with the Chongqing municipal government during his first visit to China. Nick Whittingham, British Consul General in Chongqing, later commented the agreement could be an indication that British-funded HSBC and Standard Chartered would tap into the city’s rural financial market.