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Transparency of Supervision Over Foreign Banks Enhanced
Shanghai, the biggest window through which China has opened its financial sector to the outside world, recently supervised the business of Citibank and 20 other foreign banks in China. This measure, conforming to the common international practice, has greatly enhanced the transparency of supervision over foreign banks in China.
Wang Qinghua, deputy governor of the Shanghai Branch of the People's Bank of China (PBOC), said recently at a working conference on foreign banks in Shanghai that presently in Shanghai there are 21 branches of foreign banks, designated by various large foreign banks, as main banks reporting their business in China, taking up 57 percent of the total in China. Among the 21 main reporting banks, the Citibank, the Standard Chartered Bank and the Hong Kong and Shanghai Banking Co. have set up general representative offices in Shanghai.
Wang said that the Shanghai Branch of the PBOC received the formal reports from another three foreign banks applying for moving their main reporting banks to Shanghai, in this way, the number of such banks will increase at least to 24 next year.
Reports say that along with the gradual formation of a competition market of Chinese banks and the in-depth development of the business of foreign banks in China, the method of supervision exercised by the PBOC over foreign banks has also been readjusted accordingly, and supervision has been started since this past February over the business of foreign banks which have two or more business institutions in China. This measure accords with the relevant principles of the Basel Committee on Banking Supervision of the Bank for International Settlements
Wang said that after China's entry into the WTO, the number, business scope, service categories and assets scale of single foreign bank in China will be further expanded. In order to adapt to the new situation, the PBOC is stepping up revision of regulations on the management of foreign banks.
By PD Online staff member Deng Gang
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