The China Banking Regulatory Commission (CBRC) on Thursday denied a media report in Hong Kong that it has told domestic banks to halt interbank lending to U.S. banks.

"The regulator has never, through any channel, issued a statement or told domestic commercial banks not to lend to U.S. financial institutions," the CBRC said in a statement.

The South China Morning Post reported on Thursday that the regulator ordered local banks to halt interbank lending to U.S. banks to avoid possible losses during the financial crisis.

The newspaper cited unidentified sources as saying that the ban applied to interbank lending of all currencies to U.S. banks but not to banks from other countries.

The South China Morning Post had carried an irresponsible report without seeking verification, said the statement. It added that the regulator condemned this and reserved the right to ascertain legal responsibility.

(Xinhua News Agency September 25, 2008)