Letters to Editor
Business & Trade
Culture & Science
Policy Making in Depth
News of This Week
Learning Chinese
Banks Dancing to WTO Tune

Chinese commercial banks are busy preparing for the upcoming challenges brought by the country's accession to the World Trade Organization.

Jiang Jianqing, president of the Industrial and Commercial Bank of China (ICBC), said his bank would actively carry out comprehensive reform in accordance with the requirements of the modern enterprise system to gradually improve the bank's corporate governance in the coming five years.

"The ICBC will also try to establish an effective internal mechanism and an advanced risk-control management system during the five years," Jiang said.

Frank Kolhatkar of the United States accounting firm Deloitte Touche Tohmatsu said China's banking industry is facing tremendous challenges, now that China is a WTO member.

The country will undoubtedly see a flood of foreign banks entering the market, said Kolhatkar, who is executive director for global financial-service industries.

"Chinese banks will face fierce competition from foreign counterparts and may face the loss of their market share, large clients and qualified employees," he said.

Chinese commercial banks will also face the challenge of having to beef up their risk management and establish good corporate governance, he said.

Bank of China President Liu Mingkang said his bank has continuously improved its decision-making system and enhanced internal-control system since 2000 with the aim of upgrading the corporate-governance mechanism.

The bank took the lead in China in compiling financial reports in accordance with international accounting standards, which reveal more information including the ratio of bad loans, Liu said.

The bank also paid key attention to training and human-resource management.

Zhang Enzhao, president of China Construction Bank, said his bank will continue to deepen reform to improve its business mechanism this year and in the years ahead.

"The establishment of a modern corporate-governance system will top the agenda," Zhang said.

His bank's business should cater to market demands and have a strict risk-control system, he said.

Zhang noted his bank's non-performing loans last year dropped by 3.18 percentage points from the start of 2001 to end the year at 14.92 per cent.

With the aim of reducing the amount of non-performing loans, the bank offered special prizes for those who achieved remarkable achievements and it punished those who did not fulfill their tasks.

(China Daily February 9, 2002)

Solely-owned Commercial Banks Allowed to List after Reformation
China Vows to Increase Financial Supervision
Rules on Foreign Banks Applauded
New Loan-rating System to Be Enforced in China
The People's Bank of China
Bank of China
China Construction Bank
Industrial and Commercial Bank of China
Copyright © China Internet Information Center. All Rights Reserved
E-mail: webmaster@china.org.cn Tel: 86-10-68996214/15/16