The People's Bank of China (PBOC) last week introduced Central Bank Bills Swap (CBS) to support perpetual bonds issued by commercial banks to replenish capital. Many analysts say that it is essentially Chinese version of QE (Quantitative Easing).
Sun Guofeng, director of the central bank's monetary policy department, said in an interview on Thursday that in the operation of CBS, "perpetual bonds are still held by banks, ownership not transferred and banks can not move the items off the balance sheet using this tool. "
"Credit risk is still borne by banks, the central bank only provide support for . . .
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