China Drafts Bank Deposit Insurance in Move to Free Rates
This article is for subscribers only.
China will start an insurance system for bank deposits, a move toward scrapping remaining controls on interest rates and allowing lenders to fail in a more market-driven economy.
The government will insure deposits of as much as 500,000 yuan ($81,367) per saver at each bank covered, the People’s Bank of China said in a draft rule on its website yesterday. It didn’t give a start date or detail what premiums banks may pay, saying only that they may differ depending on lenders’ management and risk conditions. The PBOC is seeking feedback through Dec. 30.