The People’s Bank of China (PBoC) has expressed concern at the growing risks tied to commercial bills of exchange, a kind of short-term financing instrument, Bloomberg reported. Overdue payments in commercial bill financing at banks and other financial institutions increased to US$1.5 billion at the end of June, up 10.1% from the end of the first quarter. The PBoC said the majority of defaults were in rural institutions such as rural credit cooperatives. Overdue payments in these organizations rose 128%. Commercial bills of exchange, which have a validity of no more than six months, were responsible for US$368 billion in short-term financing transactions in the second quarter of 2010, up 17% year-on-year. China’s banking regulators have warned about the risks created by record bank lending of US$1.4 trillion last year. Last week banks were ordered to transfer off-balance-sheet loans onto their books.