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China's central bank calls for stronger defences against financial crisis

FILE PHOTO: The People's Bank of China headquarters in Beijing

BEIJING (Reuters) - China should accelerate legislation of the Financial Stability Law and improve other legal arrangements designed to prevent and dispose of financial risks, three officials from the People's Bank of China (PBOC) wrote in China Finance, a publication affiliated to the central bank.

Financial authorities should strengthen supervision of financial institutions' date accuracy to prevent risks, the article said, saying if any enlightment should be drawn from the Silican Valley Bank crisis.

China should also let the insurance deposit system play its full role, allowing the mechanism to deal with problematic banks in a swift and orderly manner, so as to effectively prevent systematic risks, said the authors, who are from PBOC's Financial Stability Bureau and the Deposit Insurance Corp.

China's commercial banks as a whole are sound and stable, the article said.

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The authors said China should consolidate the capital reserves for dealing with financial risks to ensure that there are sufficient resources to dispose risks in a timely manner.

(Reporting by Sophie Yu, Brenda Goh; Editing by Raissa Kasolowsky)