China Plans to Strengthen Control Over State Financial Institutions
China’s top policymakers signaled that the country’s state-owned financial institutions, including banks, securities firms and insurance companies, will remain at the heart of financing the country’s development, and they called for improvements in the management of the companies and the funds they control to better serve the economy.
“State-owned financial institutions play an important role in serving the real economy, preventing and controlling financial risk, and deepening financial reform,” according to a document released jointly on Sunday by the ruling Communist Party and the State Council, China’s cabinet.
“State-owned financial capital is also an important guarantee for advancing national modernization and safeguarding national financial security,” it said, defining “state-owned financial capital” as the capital and entitlements of the state and its authorized investment entities through direct and indirect holdings in financial institutions.
The document (link in Chinese) highlighted a series of shortcomings in the way financial capital owned by the state is managed, such as “decentralization of duties, unclear power and responsibilities as well as unclear authorization.” It also called for an improvement in the efficiency of resource allocation and in the rule of law.
To better serve China’s socialist market economy, the dominant position of state-owned financial capital in the financial sector will be maintained and the state should continue to have control over key financial institutions, according to guidelines contained in the document. Even so, the allocation of capital needs to be optimized and adjusted in banking, insurance, securities and other industries to make it more efficient and enable strategic and security targets to be achieved, it said.
The guidelines gave specific requirements for improving the management of state-owned financial capital, including the clarification of the role and responsibilities of various state actors. The Communist Party’s leadership over state-owned financial institutions will be strengthened and its supervision over capital will be enhanced, according to the document.
The State Council, on behalf of the country, holds ownership rights to state-owned financial capital, while the State Council and local governments are to take on the role of investors. The Ministry of Finance is authorized to perform duties related to the State Council’s role as an investor, while local governments have the power to authorize local financial departments to do the same.
The duties of investors will include participation in major decisions, selecting managerial staff, and the right to the profits of the relevant financial institutions.
Contact reporter Liu Xiao (email@example.com)
Jan 20 14:34
Jan 20 10:52
Jan 19 19:10
Jan 18 07:20
Jan 18 07:18
Jan 18 07:14
Jan 17 15:37
Jan 17 15:25
Jan 17 14:02
Jan 17 10:20
- 1Cash-Stuffed Secret Vault Appears in CCTV Documentary
- 2Corrupt Chinese Official Pours Moutai Down the Drain
- 3Update: U.S. and China Sign Phase One Trade Deal
- 4JD.com Doubles Down on Smaller-Cities Expansion to Bolster 2020 Growth
- 5Wuhan Virus Latest: Almost 300 Infected as Philippines Reports First Case
- 1Power To The People: Pintec Serves A Booming Consumer Class
- 2Largest hotel group in Europe accepts UnionPay
- 3UnionPay mobile QuickPass debuts in Hong Kong
- 4UnionPay International launches premium catering privilege U Dining Collection
- 5UnionPay International’s U Plan has covered over 1600 stores overseas