Banks/Banking in China

Banking in China is undergoing severe changes in the recent decades and is functioning very well than before. The banking industry in China has gained autonomy, yet remains in the hands of the government. The WTO accession has resulted in significant openings to foreign participation.

The central bank is the People’s Bank of China that formulates as well puts to implementation the monetary policy. The central bank maintains payment, settlements and clearance of the banking sectors and also manages gold reserves and official foreign exchange. The monetary instruments of this bank include trading government bonds and setting commercial banks interest rates.

In 2003, CBRC (China Banking Regulatory Commission) took to supervising the PBOC. The main aim of this bank was to enhance the efficiency of banks in China and to assist PBOC in focusing the currency policy and macro economy.

CBRC is in charge for asset management companies, supervision and regulation of banks, investment companies and financial institutions. The main aim of CBRC is to retain a sound and safe system of banking in China.

Big Banks

The big top banks in China are commercial banks that are state-owned namely, the Bank of China (BOC), the Agricultural Bank of China (ABC), the Industrial and Commercial Bank of China (ICBC) and the China Construction Bank (CCB). These four banks are the domestic key players.

The ICBC stands second in foreign exchange and first in clearing business. It takes care of the manufacturing sector and urban areas. The BOC specializes in trade finance and foreign exchange transactions. CCB offers medium to long term credit for urban housing development and infrastructure projects, while the ABC offers financial assistance to agricultural sector and other rural institutions.

Succeeding commercial banks

Apart from the major four commercial banks in China that are state-owned, there are succeeding commercial banks smaller in size. However, the largest in this succeeding group of banks in China are China CITIC Bank, Hua Xia Bank, Bank of Communications, China Merchants Bank, Industrial Bank, Shenzhen Development Bank, Guangdong Development Bank and Shanghai Pudong Development Bank. These banks in China are healthier and profitable with low non-performing loan ratios.