Man who transformed Shanghai into global financial centre tasked with helping China's markets reform

The key man behind Shanghai's efforts to transform itself into a global financial centre has been appointed vice-chairman of the mainland's securities regulator, two sources with knowledge of the matter said.

Observers said Fang Xinghai's promotion would help the government carry out further reforms of the country's capital markets.

Fang - known as a reform-minded financial official, who also has a PhD in economics from Stanford University - would replace Liu Xinhua at the China Securities Regulatory Commission, the sources said. Liu has exceeded retirement age.

A source close to the securities regulator said the appointment of Fang, a technocrat with a good understanding of Western financial markets, showed Beijing was keen to drastically reform the domestic securities sector following a recent stock market rout that sparked fears of a financial crisis in the world's second-largest economy.

The securities regulator declined to comment on the appointment.

Fang was previously a bureau director at the Office of the Central Leading Group for Financial and Economic Affairs, a high-level organisation that advises Communist Party bosses on financial and economic policy.

Fang is the second newly appointed vice-chairman of the regulator in recent weeks.

Li Chao, formerly vice-chairman of the country's foreign-exchange regulator, was named last month to fill a vacancy left by the retired Zhuang Xinyi.