Banks, SAFE Cooperate to Keep Forex Flowing

(Beijing) – In an odd twist for China's powerful banks, the biggest state-owned lenders last year started running low on the foreign currency needed for loans to enterprises investing overseas.

"Some commercial banks suspended U.S. dollar loans" after the dry spell began in mid-2011, a source at a Shanghai branch of a state-owned bank told Caixin. "Others charged interest rates of more than 5 percent. The market's foreign currency supply has been tight."