Chinese banks have made "significant improvements in risk measurement and risk management", according to experts of the IMF and World Bank.
The report described the improvements as based on based on high-quality capital and liquidity.
According to the report, the China Banking Regulatory Commission is on the right track with its reform agenda and needs to persevere in a sustained way in its current direction.
"It will need the full support of all other parties in the government to succeed in the goals it has set for itself", the report emphasized.
The report lauded the China Banking Regulatory Commission for demonstrating its willingness to act in pursuit of its safety and soundness mandate and is widely respected because of this.
On the other hand, the People's Bank of China stated that the report has significant reference value for improving China's banking system and that suggestions from the IMF and World Bank can help accelerate the reform of the financial sector and improve the risk management framework to support stable and sound economic growth.
However, according to the report, complexities and risks are increasing along with further opening up and innovation in the country's financial market, which requires the top regulator to evolve quickly in the short term and get ready to meet the challenges.
The IMF and World Bank report said that "the framework of laws and guidance" in the Chinese banking sector's risk management system "is generally of high quality, but much of it is relatively recent. Implementation by banks needs to be improved".
For more, click here.
Do you know more about this story? Contact us anonymously through this link.