China Banking Regulatory Commission (CBRC) Tuesday said it has no plan to suspend approving domestic lenders' establishment of new branches.

Its policies on accepting and reviewing applications for new branches of commercial banks remain unchanged, it said.

However, CBRC said it would be "more prudent" on city banks' inter-regional expansion without elaborating how the prudent manner would work.

The banking regulator was responding to previous media reports, which suggested that the commission had unofficially suspended approving city lenders' expansions outside their own markets of origin, after Qilu Bank Co. fell victim to a commercial paper fraud that was uncovered late last year.

CBRC Chairman Liu Mingkang said in April that city commercial banks should focus on their own markets of origin, prevent risks and improve services.

According to official data, non-performing loans of China's city commercial banks totaled 32.56 billion yuan (5.01 billion U.S. dollars) at the end of 2010, 5.13 billion yuan less from that at the beginning of last year.