In an interview with China’s ruling party mouthpiece People’s Daily on Wednesday, the head of the country’s banking regulator gave every indication that financial risk-reduction remained a top priority for Beijing.
In response to a question about the next steps in the ongoing regulatory crackdown, China Banking Regulatory Commission chairman Guo Shuqing called out a group of “outlaws” as significant obstacles.
Though the ownership structure of Chinese banking is relatively well developed, he said, corporate governance still lags behind the sector’s development.
“Some shareholders go so far as to treat banks as their own personal ATMs,” Guo said. “There is a minority of outlaws that use complex structures, false investments and repetitious cash injections, violate the construct of large financial groups, and have already become a serious obstacle to the deepening of financial sector reform and the maintenance of security of the banking system.”
“They must be severely punished according to the law,” he warned.
In the interview Guo also reiterated the need to reduce the debt ratio in the private sector, rein in household debt and continue efforts to crack down on the shadow banking sector.