Moody’s: China making progress in reigning in shadow banking sector

The latest report from the US-based Moody’s Investors Service released on Monday, showed that the shadow baking regulations imposed by the Chinese authorities are successful in reigning in credit growth.

Key Points:

Enhancement of shadow banking regulations is having some effect in moderating growth of wealth management products.

China's shadow banking sector is worth $9.4tn. Authorities have been cracking down on off-balance-sheet lending during the last 12 months.

Authorities are careful not to trigger financial instability with the new regulations.

"There have been some encouraging signs that enhanced regulatory policy measures have successfully constrained the growth of the banks' wealth management products and "investment receivables".