China bank ratio cut draws mixed reactions

Shanghai

CHINESE bankers welcomed Beijing's decision to cut the level of reserves they must hold, hoping they can put the freed-up cash to profitable use, but struggling Chinese companies hoping it will mean more and cheaper loans are likely to be disappointed.

After a slew of gloomy economic data, the People's Bank of China (PBOC) cut banks' reserve requirement ratios (RRR) by 50 basis points on Wednesday, freeing up an estimated 600 billion yuan (S$129 billion) into the money supply.