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2014 | OriginalPaper | Buchkapitel

17. Heading Towards Good Governance: A Case Study of the Chinese Commercial Banks

verfasst von : Dr. Jing Bian

Erschienen in: Corporate Governance

Verlag: Springer Berlin Heidelberg

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Abstract

Chinese banking industry has experienced significant improvements over the last few years. These developments not only reflect on the industrial structure as a whole, but also on the level of performance of individual banks. Examining the development of the Chinese banking industry; corporate governance, as a major concern, has simultaneously evolved. Given the rapid development of the financial system, and the lack of relevant laws and regulations, corporate governance of the Chinese banking industry still needs to be further enhanced; in particular, further improvements of corporate governance have been hindered by various existing problems in this area; for instance, the incomplete legal framework, inefficient enforcement structure and a weak corporate disclosure regime. This Chapter, taking Chinese commercial banks as the example, aims to examine the relevant issues of corporate governance. Firstly the Chinese banking industry is studied. Following that, the regulatory frameworks for commercial banks and the banking regulators are introduced. Thirdly, approaches adopted by the Chinese banking sector to enhance corporate governance are examined in detail. Finally, a conclusion is drawn based on the observation of this research.

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Fußnoten
1
CBRC Annual Report (2011), p. 24.
 
2
The latest lists of domestic banking institutions can be found at China Banking Regulatory Commission website: http://​www.​cbrc.​gov.​cn.
 
3
The policy bank in China were established according to Decision of the State Council on Reform of the Financial System, in order to separate policy finance from commercial finance and to solve the problem of national specialized banks executing dual function. The National Development Bank,handles policy loans and discount business for key national construction projects (including capital construction and technical transformation). The Agricultural Development Bank of China (ADBC) to undertake policy loans for State reserve in grain, cotton and edible oil, for contract-purchasing of farm and sideline products, and agricultural development, and to appropriate fiscal funds for supporting agriculture and to supervise their use as an agent. The China Import–export Credit Bank (CIECB) supplies buyer’s and seller’s credits for importing and exporting of large scale mechanical and electrical equipment, etc. See Decision of the State Council on Reform of the Financial System, Guofa [1993] No. 91, promulgated date: 25 December 1993, part 2.
 
4
“Commercial banks” means enterprise legal persons that are established in conformity with the law and take in deposits from the general public, grant loans, handle settlements, etc. See Law of the People’s Republic of China on Commercial Banks, promulgated date: 10 May 1995, revised date: 27 December 2003, Article 2. According to Article 3 of this law, the commercial banks may engage in the following business: taking deposits from the general public; granting short-term, medium-term and long-term loans; handling domestic and foreign settlements; handling the acceptance and discounting of negotiable instruments; issuing financial bonds; acting as an agent for the issue, honouring and underwriting of government bonds; buying and selling government bonds and financial bonds; engaging in interbank lending; buying and selling foreign exchange and acting as an agent for the purchase and sale of foreign exchange; engaging in the business of bank cards; providing letter of credit services and guaranty; acting as an agent for the receipt and payment of money and acting as an insurance agent; providing safe deposit box services, etc.
 
5
See PBOC website, http://​www.​pbc.​gov.​cn/​publish/​english/​952/​index.​html, last accessed: 11 July 2012. Law of the People’s Republic of China on the People’s Bank of China, promulgated date: 18 March 1995, effective date: 18 March 1995, revised date: 27 December 2003.
 
6
The main functions of the CBRC are: to formulate supervisory rules and regulations governing the banking institutions; to authorize the establishment, changes, termination and business scope of the banking institutions; to conduct on-site examination and off-site surveillance of the banking institutions, and take enforcement actions against rule-breaking behaviours; to conduct fit-and-proper tests on the senior managerial personnel of the banking institutions; to compile and publish statistics and reports of the overall banking industry in accordance with relevant regulations; to provide proposals on the resolution of problem deposit-taking institutions in consultation with relevant authorities. See CBRC website, http://​www.​cbrc.​gov.​cn/​english/​info/​yjhjj/​index.​jsp, last assessed: 17 July 2012.
 
7
Promulgated date: 10 May 1995, amended on 27 December 2003, and came into force on 1 February 2004.
 
8
Promulgated date: 8 November 2006, came into force on 11 December 2006.
 
9
ibid, or (Zhou, 2007).
 
10
CBRC, 25 July 2011, consultative version.
 
11
ibid, Article 3.
 
12
ibid, Article 7.
 
13
Company Law of the People’s Republic of China, promulgated date: 29 December 1993, revised date: 27 October 2005; effective date: 1 January 2006.
 
14
No.252 [2007] of the General Office of China Banking Regulatory Commission, issued date: 5 December 2007, effective date: 5 December 2007.
 
15
ibid, Part 1
 
16
ibid, Part 2
 
17
ibid, Part 3.
 
18
ibid, Part 3.
 
19
The reports can be found at CBA website, http://​www.​china-cba.​net/​list.​php?​fid=​65. Last accessed: 12 December 2012. The CBA is the self-regulatory organization for the Chinese banking institutions. It was established in 2000. At the end of November 2012, the CBA has 168 member banks and 2 observer banks.
 
20
China Banking Association, issued date 12 January 2009, effective date: 12 January 2009.
 
21
ibid, Article 2.
 
22
ibid, Article 3.
 
23
ibid, Article 3.
 
24
See Shanghai Pudong Development Bank website, http://​www.​spdb.​com.​cn/​docpage/​c511/​200605/​0519_​511_​13975.​aspx, last accessed: 5 April 2013.
 
26
CBRC, 2011 Annual Report, Part 7.
 
27
“Conference on Corporate Social Responsibility of Banking Industry and Central Stated Owned Enterprises Held in Beijing, Representatives from Global Financial Institution Discussed the Corporate Social Responsibility (Yinhangye yu Yangqi Shehui Zeren Yantaohui zai Jing Zhaokai Quanqiu Jinrong Daibiao Gongshang Qiye Shehui Zeren)”, Legal Daily (Fazhi Ribao), 10 January 2012.
 
28
The OECD Principles of Corporate Governance (1999).
 
29
The OECD Principles of Corporate Governance (2004).
 
30
See BIS website, http://​www.​bis.​org/​publ/​bcbs197.​htm. Last accessed: 12 May 2013.
 
31
PBCO, [2012] No. 6, promulgated date: 15 May 2002, repealed on 3 July 2007.
 
32
ibid, Article 5.
 
33
ibid, Article 8.
 
34
ibid, Article 9.
 
35
ibid, Article 10.
 
36
CBRC, [2007] No. 7, promulgated date: 3 July 2007, effective date: 3 July 2007.
 
37
ibid, Article 19.
 
38
ibid, Article 20.
 
39
ibid, Article 21.
 
40
ibid, Article 22.
 
41
Promulgated date: 25 July 2008, effective date: 1 September 2008.
 
42
ibid, Article 3.
 
43
ibid, Article 4.
 
44
ibid, Article 16.
 
45
ibid, Article 24.
 
46
Issuing date: 4 October 2010.
 
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Metadaten
Titel
Heading Towards Good Governance: A Case Study of the Chinese Commercial Banks
verfasst von
Dr. Jing Bian
Copyright-Jahr
2014
Verlag
Springer Berlin Heidelberg
DOI
https://doi.org/10.1007/978-3-642-45167-6_17