China regulators work together to tackle shadow banking in latest sign of integration
Head of securities watchdog talks of close cooperation with counterparts, adding weight to ‘super-regulator’ speculation
China’s government regulators appear to have taken a tentative step towards achieving the decade-old quest to create a one-stop, super regulator with oversight of the fragmented banking, securities, and insurance industries.
The head of the mainland’s securities regulator alluded to greater cooperation between the organisations responsible for overseeing financial compliance, signalling that they may soon be brought under one umbrella.
China’s lending market is currently under the fragmented supervision of three separate bodies - the China Securities Regulatory Commission (CSRC), the China Insurance Regulatory Commission (CIRC) and the China Banking Regulatory Commission (CBRC).
All three adopt different standards in areas ranging from eligible investor recognition to risk control.
Combining them into a single unified financial watchdog is seen as key to reining in risks posed by the China’s multi-trillion dollar shadow financing sector, and its possible knock-on effects in the broader lending market.
In a sign that the process of merging the functions may already be under way, Liu Shiyu, chairman of the CSRC, said his organisation would work closely with other bodies as it tries to strengthen the regulation of capital markets.