MNI China Press Digest Sept 12: SME Banks, Reforms, Mexico

Highlights from Chinese press reports on Friday:

• China's 27 city and rural commercial banks held about CNY36 trillion as of end-June, up CNY3 trillion from the end of 2024, Yicai reported. City and rural commercial banks lifted their share of listed-bank assets from below 11% in 2024 to about 11.21% at the end of June, after faster balance-sheet expansion relative to state-owned and joint-stock peers. Data from the National Financial Regulatory Administration show the sector’s average NIM at 1.42% by end-Q2, with city commercial banks at 1.37% and rural commercial banks at 1.58%. Non-performing loan ratios have fallen in 11 city and rural commercial banks since December 2024, with 12 unchanged and four rising, Yicai noted.
• China will pilot market-oriented reform in 10 regions, including Beijing, Chengdu and the Greater Bay Area, focusing on the allocation of technology, land, human resources, data, capital and environmental resources, the State Council announced. Li Chunlin, deputy director at the National Development and Reform Commission, said that while China has achieved market-based pricing for most goods and services since the reform and opening, the system for factors of production remains underdeveloped, limiting the market’s decisive role in resource allocation. He said the pilot reforms will identify pathways for more efficient allocation across broader areas. The pilots will run for two years and are scheduled for completion in 2027, Li added.
• China will take necessary measures to safeguard its legitimate rights and interests following Mexico's imposition of import tariffs on roughly 1,400 categories of goods, including automobiles, toys, steel, textiles, and plastic products, of between 10% and 50%, the Ministry of Commerce has said. The ministry’s spokesperson said countries should strengthen coordination to defend free trade and multilateralism, rather than yield to external pressure at the expense of third-party interests. Analysts noted that Mexico’s move appears aligned with the U.S.’s long-standing efforts to constrain China, Yicai said.