Mainland equity markets recovered slightly yesterday as the People’s Bank of China (PBoC) moved to reassure investors, the Financial Times reported. Comments by PBoC Vice Governor Su Ning posted on the central bank’s website on Wednesday night helped to allay fears that the government would severely rein in lending. The Shanghai Composite Index closed up 1.7% to 3,321.56 points a day after falling 5%. Steelmakers performed particularly well, with Baoshan Iron and Steel rising 4.5% to RMB9.45 (US$1.38), while Angang Steel rose 3% to RMB16.98 (US$2.48). Analysts said that with the recovery at an early stage, Beijing would be unlikely to change its policies. However, highlighting ongoing disagreement within the government over the risks of lending, the China Banking Regulatory Commission has drafted new rules on loans used for working capital over fears that unrestricted lending could lead to asset bubbles.