PBoC Cuts RRR for Small Banks amid Covid-19 Crisis

The People's Bank of China announced it will cut the reserve requirement ratio for mid-sized and small banks by 100bps, in two phases, releasing around CNY 400 billion to support the economy hurt by the Covid-19 pandemic.

The first cut of 50bps will be effective as of April 15th, and second cut of another 50bps will be effective as of May 15th.

In addition, financial institutions' excess reserve requirement ratio with the central bank would be reduced to 0.35 percent from 0.72 percent, effective April 7th.

Meanwhile, the reserve requirement ratio (RRR) for large banks was kept at 12.5 percent.