People's Republic of China Financial Sector Assessment Program : Basel Core Principles for Effective Banking Supervision
The China Banking Regulatory Commission (CBRC) has maintained its momentum in regulation and supervision in the face of exceptional growth in scale and increasing complexity of the banking system. Equally, the CBRC has risen to the demands of the i...
| Main Authors: | , |
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| Format: | Report |
| Language: | English |
| Published: |
Washington, DC
2017
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/596881512550833789/China-Financial-sector-assessment-program-detailed-assessment-of-observance-Basel-core-principles-for-effective-banking-supervision http://hdl.handle.net/10986/29048 |
| Summary: | The China Banking Regulatory Commission
(CBRC) has maintained its momentum in regulation and
supervision in the face of exceptional growth in scale and
increasing complexity of the banking system. Equally, the
CBRC has risen to the demands of the international
regulatory reform agenda, delivering timely revisions to its
body of regulations and maturing its supervisory practices
through investing in essential new skills, enhancing
methodologies, and broadening its interactions with the
industry. In this context, the clarity of supervisory
requirements and expectations communicated to the industry
is a strength of the CBRC. Recent organizational reforms, in
2015, building on other internal reforms, will serve the
CBRC well in delivering its supervisory mandate. While
pursuit of financial stability is recognized as
fundamentally important, concerns must be acknowledged as to
whether the CBRC would, in practice, always be able to act
on its primary, stability, objective, especially if
government policies, whether focused growth and expansion,
or social protection, conflicted with prudential
considerations. The China Banking Regulatory Commission
(CBRC) has achieved a high degree of compliance with the
Basel Core Principles for Effective Banking Supervision
(BCPs). Notwithstanding the revision to the BCP methodology,
which raised the standards expected of supervisory
authorities, the CBRC has demonstrated progress in almost
all areas. Nevertheless, further maturing is needed, and
taken together the recommendations of this report seek to
support the CBRC in developing deeper and more comprehensive
diagnostic capabilities, which ought to facilitate early,
effective and preventative actions as necessary. It is
essential that the CBRC’s achievements in recent years are
consolidated as new challenges and complexities in the
system will continue to emerge. In particular, it is
essential that the CBRC obtain the resources to expand its
range and depth of skills before developments in the
industry leave it unable to maintain meaningful oversight
and authority, not least of the four Global Systemically
Important Banks (GSIBs). Building on the supervisory vision
expressed in prestige CBRC publications such as the Annual
Report, a detailed forward strategy for supervision,
covering three to five years, would serve as a vehicle for
the CBRC to articulate its case for resources. |
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