Reuters-6:52 PM PT Sept. 24, 2008
Chinese regulators have told domestic banks to stop interbank lending to U.S. financial institutions to prevent possible losses during the financial crisis, the South China Morning Post reported on Thursday.
Reuters-9:49 PM PT Sept. 24, 2008
The China Banking Regulatory Commission on Thursday denied a newspaper report that it had told Chinese banks to stop lending to U.S. banks in the interbank market. A spokesman for the regulator strongly codemned the article in Thursday’s South China Morning Post, calling it irresponsible.”The CBRC has never, through any channel, issued a statement or told domestic commercial banks not to lend to or borrow from U.S. financial institutions,” the spokesman said in a statement on the agency’s website.
This is a non denial denial. There is a big difference issuing an order to stop lending to American institutions and suggesting that for their own good, they might stand clear of the trainwreck. My guess it was the latter.