By intern reporter Zhang Man

Commercial banks have been ordered to rapidly review the account of any debtor victimized by the Sichuan earthquake and, in some cases, wipe the slate clean.

The order was issued May 22 by the China Banking Regulatory Commission (CBRC). It said banks should waive all debt and close the accounts of any debtor who can't repay due to quake-related losses for which insurance policies fail to provide at least partial coverage, or if the coverage is inadequate to cover the debt.

In addition CBRC said banks should cancel the debts and accounts of credit card holders confirmed to be dead or missing in the disaster, and who have no assets that can be used to pay off debts.

But to protect banks, CBRC ruled that if a bank is unable to retrieve evidence of a debtor's liabilities and assets condition, it can gather information from other sources such as local government agencies and courts.

The regulator asked banks to report questionable accounts and conduct debtor reviews efficiently. Meanwhile, CBRC said it would watch carefully for any attempts to abuse the waiver program.

Related Special Report:
Jarred, Scarred and Brave