中监为体、西监为用 or the specifics of Chinese bank regulation

Cousin, Violaine (2011): 中监为体、西监为用 or the specifics of Chinese bank regulation.

Abstract

The present paper aims to propose an explanation for the rationale behind the current banking regulatory arrangement in China. A now stable and relatively healthy banking system emerged largely unscathed from the financial crisis without relying much on recognised international best practices in bank supervision. China combines a strong regulatory hand together with a capital adequacy requirements stick, without much intervention of foreign or private institutions in the larger sense of the term. After an in-depth review of the Chinese framework we recognise that it is exactly this lip service to private monitoring mechanisms on top of restrictive regulators that allows for stability and growth - at least for now. China uses Chinese supervision as the core and western regulatory instruments as useful add-ons - a manner similar to the catch phrase used over a century ago to rejuvenate China.

• Item Type: MPRA Paper
• English Title: The specifics of Chinese bank regulation
• Language: English
• Keywords: regulation, bank, china
• Subjects: G - Financial Economics > G2 - Financial Institutions and Services > G28 - Government Policy and Regulation; G - Financial Economics > G2 - Financial Institutions and Services > G21 - Banks ; Depository Institutions ; Micro Finance Institutions ; Mortgages

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References for laws and regulations.

1. 中华人民共和国商业银行法(修正) [Commercial banking law], first issue 1995, revision 2003.

2. 中华人民共和国银行业监督管理法 [Law of banking supervision and administration], 2003.

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5. 商业银行信息披露暂行办法 [Provisional rule for the information disclosure at commercial banks], 2002.

6. 商业银行资本充足率管理办法 [Regulation governing the capital adequacy of commercial banks], 2004.

7. 股份制商业银行风险评级体系 (暂行) [Risk grading system for JSCBs (provisional)], 2004, amended through 商业银行风险监管核心指标（试行）的通知 [Notice on commercial banks’ risk supervision core indicators (provisional)] in 2005.

8. 外资银行并表监管管理办法 [Rule governing the consolidated supervision of foreign banks], 2004.

9. 金融机构摊消条例 [Rule on dissolution of banks], 2001.

10. 商业银行次级债券发行管理办法 [Rules on the issuance of subordinated bonds by commercial banks], 2004.

11. 中华人民共和国企业破产法 [PRC Enterprise bankruptcy law] 2006.

12. 中华人民共和国公司法 [PRCcompany Law] 2005.

13. 关于完善商业银行资本补充机制的通知 [Notice on mechanisms to perfect commercial banks‘ capital buffer], 2009.

14. 关于加强地方政府融资平台公司管理有关问题的通知 [Notice on issues relevant to the strengthening of the management of local government financing platforms], 2010.

15. 中华人民共和国外资银行管理条例 [PRC Management ordinance on foreign banks], 2006 as well as 中华人民共和国外资银行管理条例实施细则 [Implementation guidelines on PRC Management ordinance on foreign banks], 2006.

16. 关于进一步改进外商投资审批工作的通知 [Notice on improving approval of foreign investors], 2009 and 境外投资管理办法 [Management rule on foreign investors], 2009.

The above lists only those regulations which were cited in the text, it is not an exhaustive list of banking relevant laws and regulations.