Guo Shuqing, chairman of the China Banking Regulatory Commission. (Photo/China Daily)
Guo Shuqing, chairman of the China Banking Regulatory Commission, has been named Party secretary of the to-be-formed China banking and insurance regulatory commission, the country's top banking regulator said in a post on its website on Thursday night.
The announcement was made after China's national legislature approved an institutional restructuring plan of the State Council, the cabinet, on March 17. According to the plan, the country's top banking and insurance regulators will be merged.
Guo said at the appointment meeting that the formation of the China banking and insurance regulatory commission "is of great significance in terms of promoting the construction of a modern financial regulatory framework, improving the ability to regulate banking and insurance activities, and waging a tough war on financial risks".
He said the management team will push ahead in an orderly manner with the formation of the new agency and will continue to do a good job in regulation. In particular, he highlighted the importance of making sure that daily work such as financial regulation and major risk disposal will be carried out as normal during the process of institutional reforms, according to the post on the CBRC website.
Since he took office as chairman of the CBRC in February 2017, the banking regulator has launched a number of guidelines and rules on various aspects of the banking sector, including regulation of entrusted loans, equity management at commercial banks and data governance. It also tightened inspection and got tougher on the correction of irregular financial market activities. "Guo has a strong ability to execute, whether as a regulatory official or as a senior banking executive," said Wu Qing, chief economist of China Orient Asset Management Co Ltd, who has been a research fellow on the banking sector for many years.
"After the merger of banking and insurance regulators, the new agency will be more effective at execution of upcoming rules and policy adjustments," Wu said.
Wu expects that changes will soon take place at financial institutions due to actions taken by Guo and his colleagues during the past 12 months. Policy adjustments will bring about major changes in the next three years, as China will switch its focus on financial risk management from preventing to dissolving risks, he added.
The country's efforts to deepen institutional reform will also bring visible changes to relevant sectors, academics said.
"In the past, the difference in rules set by regulators of different financial sectors has provided the possibility for regulatory arbitrage. Now, the merger of banking and insurance regulators will eliminate that possibility," Wu said.
Zeng Gang, deputy director of the National Institution for Finance and Development, said the overall direction of the institutional reform on financial regulators is to enable the new regulatory framework to fit for mixed operation of Chinese financial sectors.