Publication detail

Banking reforms in China: International standards and Chinese specifics

Author(s): PhDr. Zdeněk Kudrna PhD.,
Type: Articles in refereed journals
Year: 2008
Number: 0
ISSN / ISBN:
Published in: Acta Oeconomica
Publishing place: Budapest
Keywords: China, banks, reforms, international standards
JEL codes: G21, G28, P34
Suggested Citation: Kudrna, Zdenek (2008). Banking reforms in China: International standards and Chinese specifics, Acta Oeconomica, Vol. 58 (4) pp. 403–426.
Grants: „EU-China European Studies Centres Programme (ESCP)" (2005-2008)
Abstract: This paper reviews the progressofbanking reforms in China. Since 2002, the reform strategy hasrelied on publicly-financed bailouts, implementation of international best practices in bank governance and regulation, and listing of major banks in Hong Kong. The three largest banks have been stabilised, but we find little reason to expect this to be sustainable. Prudential indicators are comparable to international averages, but this is an outcome of bailouts and ongoing credit boom. Reforms of bank governance and regulatory frameworks that would alter banker’s incentives are implemented in a selective manner; principles that concentrate key powers in the centre are implemented vigorously, whereas those that require independent boards and regulators are ignored. Selectiveness of institutional reform means that the largest banks remain under state control and can be used as means of development policy for the better or the worse.

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