The recent Hengda Group issue has attracted market attention. Yi Gang, governor of the People’s Bank of China, recently said that the risk of Hengda Group is a case-by-case risk, and the spillover of the financial industry is generally controllable. It is necessary to fully respect and protect the legitimate rights and interests of creditors and property owners, especially the legitimate rights and interests of consumers who have purchased houses.
Recently, Yi Gang introduced at the 2021 G30 International Banking Seminar that Evergrande Group has debts of about 300 billion US dollars, one-third of which are financial liabilities, creditors are scattered, and there are collateral, which generally controls the spillover of the financial industry. When dealing with the issue of Evergrande Group, we must strictly follow the order of repayment stipulated by law, fully respect and protect the legitimate rights and interests of creditors and property owners, especially the legitimate rights and interests of consumers who have purchased houses. We must adhere to the principle of rule of law to ensure that the legitimate rights and interests of all creditors and interested parties are treated fairly. Overall, we are confident that we can control risks within a certain range and avoid systemic risks.
The picture shows a building under construction near Changchun Ecological Street in Jilin. Photo by Xinhua News Agency reporter Zhang Nan
Yi Gang said that since the beginning of this year, the People’s Bank of China has actively prevented and resolved financial risks, kept the macro leverage ratio basically stable, disposed of a few Financial Institution Groups such as Baoshang Bank in accordance with the law, and supported banks, especially small and medium-sized banks, to replenish their capital base through multiple channels. Adhere to the implementation of a prudent monetary policy and continue to increase support for small and medium-sized enterprises.
In addition, Yi Gang also introduced the current research and development progress of the digital yuan, and made it clear that there is no plan to promote the use of the digital yuan in the "Belt and Road Initiative" countries.
Yi Gang said that the cross-border and international use of digital currencies is relatively complex, involving anti-money laundering, customer due diligence and other issues, which are being discussed in depth internationally. In view of the complexity of cross-border use, the design and use of digital RMB is mainly to meet domestic retail payment needs. The People’s Bank of China is willing to strengthen cooperation with central banks of various countries and international institutions such as international monetary funds and the Bank for International Settlements. (Reporter Wu Yu)