PBC Publishes the 2018 Financial Stability Report on China
PBC issued the financial stability report (2018) on China. The report assesses the soundness of financial system in the country since 2017. The report concluded that resilience of financial system was further enhanced and financial operations were generally stable during the observation period. However, in the coming days, risk factors that could affect and undermine the global financial stability are mounting. Domestically, the cyclical, institutional, and structural problems, along with the risks that have built up over years in the economic and financial system, in China have started to show while the structural problems in economic performance remain prominent.
The report reveals that major policies and top-level structure for reform and development have been established. The Financial Stability and Development Committee of the State Council, which was established at the end of 2017, was further enhanced and improved with adjustments to the regulatory structure. Under the new structure, the coordination mechanism for financial regulation was strengthened; the philosophy and framework of macro-prudential management with the central bank at the core were gradually established; and the mechanism for preventing systemic risks was further enhanced. Overall, the economic and financial risks in the country can be broadly contained with little possibility of systemic financial risks. The report further notes that looking into 2019, large uncertainties still exist in the global economy and financial market. In the course of China’s economic transition and structural adjustment from high-speed growth to high-quality growth, there are still possibilities of the emergence of “grey rhino” financial risks.
Keywords: Asia Pacific, China, Banking, Financial Stability Report, Systemic Risk, PBC
Featured Experts
Blake Coules
Across 35 years in banking, Blake has gained deep insights into the inner working of this sector. Over the last two decades, Blake has been an Operating Committee member, leading teams and executing strategies in Credit and Enterprise Risk as well as Line of Business. His focus over this time has been primarily Commercial/Corporate with particular emphasis on CRE. Blake has spent most of his career with large and mid-size banks. Blake joined Moody’s Analytics in 2021 after leading the transformation of the credit approval and reporting process at a $25 billion bank.
Previous Article
FINMA Consults on Ordinance and Circular on Accounting for BanksRelated Articles
BIS and Central Banks Experiment with GenAI to Assess Climate Risks
A recent report from the Bank for International Settlements (BIS) Innovation Hub details Project Gaia, a collaboration between the BIS Innovation Hub Eurosystem Center and certain central banks in Europe
Nearly 25% G-SIBs Commit to Adopting TNFD Nature-Related Disclosures
Nature-related risks are increasing in severity and frequency, affecting businesses, capital providers, financial systems, and economies.
Singapore to Mandate Climate Disclosures from FY2025
Singapore recently took a significant step toward turning climate ambition into action, with the introduction of mandatory climate-related disclosures for listed and large non-listed companies
SEC Finalizes Climate-Related Disclosures Rule
The U.S. Securities and Exchange Commission (SEC) has finalized the long-awaited rule that mandates climate-related disclosures for domestic and foreign publicly listed companies in the U.S.
EBA Proposes Standards Related to Standardized Credit Risk Approach
The European Banking Authority (EBA) has been taking significant steps toward implementing the Basel III framework and strengthening the regulatory framework for credit institutions in the EU
US Regulators Release Stress Test Scenarios for Banks
The U.S. regulators recently released baseline and severely adverse scenarios, along with other details, for stress testing the banks in 2024. The relevant U.S. banking regulators are the Federal Reserve Bank (FED), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC).
Asian Governments Aim for Interoperability in AI Governance Frameworks
The regulatory landscape for artificial intelligence (AI), including the generative kind, is evolving rapidly, with governments and regulators aiming to address the challenges and opportunities presented by this transformative technology.
EBA Proposes Operational Risk Standards Under Final Basel III Package
The European Union (EU) has been working on the final elements of Basel III standards, with endorsement of the Banking Package and the publication of the European Banking Authority (EBA) roadmap on Basel III implementation in December 2023.
EFRAG Proposes XBRL Taxonomy and Standard for Listed SMEs Under ESRS
The European Financial Reporting Advisory Group (EFRAG), which plays a crucial role in shaping corporate reporting standards in European Union (EU), is seeking comments, until May 21, 2024, on the Exposure Draft ESRS for listed SMEs.
ECB to Expand Climate Change Work in 2024-2025
Banking regulators worldwide are increasingly focusing on addressing, monitoring, and supervising the institutions' exposure to climate and environmental risks.
