Jiangsu Province's rural banks not at risk

Rural commercial banks in east China's Jiangsu Province are in good condition and not at risk of bankruptcy, the China Banking Association said on Wednesday. The association pointed out Jiangsu Sheyang Rural Commercial Bank, which had suffered from solvency rumors, was in good condition and would not go out of business. Hundreds of customers on Monday withdrew money from a branch of the bank following rumors that it had run out of cash. The association said in a statement that rural commercial banks nationwide were in stable condition. Their key risk control indicators such as capital adequacy ratio, provisioning coverage ratio and liquidity level were better than the industry average. The association said the branch was located near some guarantee companies and that private fund-raising was common in the area. There have been cases of some local guarantee company owners running away after they were unable to meet payments. Customers are worried about banking risks and related rumors. "It is the primary function of financial institutions to protect the interests of all depositors," said the association. It urged rural commercial banks to increase cash reserves and prolong business hours to meet all withdraw requests in full amount and in time. The association also asked depositors not to spread rumors. "Fabricating or spreading such rumors will disturb China's financial market, jeopardize the country's financial security and social stability," said the association. The association said those fabricating or spreading rumors would be held legally accountable.