The CBRC Issued the Notice on Further Regulating Banking Institutions’ Deposit-taking Activities of Public Funds

 

Recently, the CBRC issued the Notice on Further Regulating Banking Institutions' Deposit-taking Activities of Public Funds (hereinafter referred to as the “Notice”) so as to standardize banking institutions’ deposit-taking activities of public funds.

 

The Notice consists of 13 articles in 5 parts and states detailed requirements in the following aspects: strengthening honesty, prohibiting tunneling of interests, guarding against moral hazards and improving service.

 

First, strengthening business management. Banking institutions should clearly stipulate the specific forms of taking public funds deposits, the expenses standards and management processes. Banks should improve the salary management system and the performance appraisal system where indicaters such as deposit scale, market share and ranking at certain time point are strictly prohibited. Also, banks should strengthen auditing and monitoring over public funds deposit and implement strict accountability and rectification of violations.

 

Second, strictly prohibiting tunneling of interests. Banking institutions should urge employees to abide by the industry code of conduct and adhere to professional ethics, integrity and honesty. Any give-away activities including cash and securities to public deposit holders are strictly prohibited; Tunneling activities like arranging employment, promotion and reward to relevant public deposit holders or their spouse and children are strictly prohibited.

 

Third, improving services. Banking institutions should fully respect the willingness and needs of public deposit holders, and carry out business cooperation according to the principle of openness, justice and equity. Banks should continuously optimize their business processes, enrich product categories, and improve comprehensive deposit services.

 

Fourth, strengthening industry self-discipline. China Banking Association should urge its members to strengthen the awareness of self-discipline, cultivate a culture of compliance, promote fair competition, guard against improper transactions, and abide by the industry regulations.

 

The implementation of the Notice is conducive to cultivating a culture of honesty and compliance among banking institutions maintaining a fair and orderly financial market environment.

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Copyright: China Banking Regulatory Commission
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