Private bank savings had soared to 8.67 trillion yuan (US$1.05 trillion) by the end of April, 53.6 percent of total deposits at all the financial institutions, said Dai Xianglong, governor of the People's Bank of China.

"I hope every commercial bank strengthens its concept of loan marketing, formulates business plans, better fosters and selects small and medium-sized corporate clients and improves efficiency in their use of funds," he said.

Dai was speaking at the Ninth General Assembly of the World Savings Banks Institute, which opened Thursday in Beijing.

The governor said China would gradually optimize the local currency's exchange rate system under the precondition of a "basically stable" renminbi and gradually loosen capital controls and promote the currency's full convertibility as its foreign exchange reserves grow.

China's foreign exchange reserves hit US$233.8 billion at the end of April, US$21.6 billion more than at the start of the year, he said.

"There is a solid basis to maintain a stable exchange rate of renminbi," he said.

He said savings banks are facing "unprecedented challenges" as the deepening development of capital markets erodes their traditional business, the fund industry grows to be a powerful rival and information technologies challenge the way they operate.

The Industrial and Commercial Bank of China is the world's biggest savings bank with more than 2 trillion yuan (US$240 billion) in savings deposits.

(China Daily May 24, 2002)