CHINA has denied reports that US$28 billion had been siphoned off from state funds. However, there is no doubt that something must be done quickly to revamp the country's inefficient banking system.
According to the director of the Monetary Research Institute of the People's Bank of China (PBOC), Qin Chijiang, broad consensus has been reached over the direction of reform of the country's rudimentary banking system.
The rectification measures introduced in the past months can solve some immediate problems, but fundamental reform is necessary to establish a healthy banking system, he says.
As a result, the drafting of laws regulating the central bank and commercial banks should no longer be delayed.
''Although the draft legislation is not perfect, it would be better to have in place than nothing at all,'' he said.
''A lot of chaos and irregularities in the banking sector arise out of the lack of regulations and standardised procedures,'' says Mr Qin.