Wang Zhaoxing, vice-chairman of the China Banking Regulatory Commission, said on Tuesday that the CBRC recently adjusted regulatory requirements on provision coverage ratio because banks have been doing well in the past few years and have a large amount of loan loss provisions.

The industry-wide provision coverage ratio is more than 180 percent, far beyond the international level, according to Wang, who is also a member of the 13th National Committee of the Chinese People’s Political Consultative Conference.

“Therefore, lowering regulatory requirements on provision coverage ratio will help accelerate disposal of nonperforming loans. It also will allow banks to have higher levels of capital and a stronger ability to support the real economy,” he said.

The China Banking Regulatory Commission issued a document on Feb 28, lowering the requirement on commercial banks’ provision coverage ratio from 150 percent to a range of 120 to 150 percent. The new ratio will vary among banks, depending on three factors, such as the percentage of loans being overdue for more than 90 days that are counted as nonperforming loans.