BEIJING -- China's banking regulator on Tuesday gave approval to five new private banks, bringing the total number of private lenders to 16.

The five banks will be in Beijing, Jiangsu, Jilin, Liaoning and Shandong, according to the China Banking Regulatory Commission (CBRC)website.

Each of the banks will be co-sponsored by at least two private capital providers.

In 2014, China approved a pilot scheme setting up five private banks to give private capital a bigger role in the country's financial system.

The new of private lenders are expected to boost financial support for smaller firms, as the state-owned lenders usually favor state-owned enterprises.

Small and medium-sized enterprises account for around 60 percent of China's gross domestic product and some 80 percent of new jobs, but they are struggling to cope with weaker global demand and tight credit.

Data from the CBRC showed that total assets of the first batch of five private lenders reached 132.93 billion yuan (around $19 billion) at the end of September. Non-performing loan ratio rose slightly to 0.54 percent.