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CBRC Issued the Regulation on China Development Bank The
Report of the 19th CPC National Congress stressed the necessity of deepening
the financial system reform, enhancing the system’s capacity of supporting the
real economy, improving the financial regulatory system, and forestalling
systemic financial risks. In line with the spirit of the Congress, and to
implement the plan on deepening the reform of China Development Bank
(hereinafter referred to as “CDB”), strengthen areas of weakness of the regulatory
system, and prevent and resolve the financial risks under the new situation,
the CBRC recently issued the Regulation on China Development Bank
(hereinafter referred to as “the Regulation”). The
Regulation was issued to meet the CDB’s needs to
deepen the reform, further strengthen its areas of weakness in regulation and
supervision. The introduction of the Regulation plays a critical role in
promoting the Bank to operate in a safe, stable and sustainable way, thus
enabling it to better serve national strategies and support the sound
development of both the economy and society. The
Regulation highlights CDB’s position as a development
financial institution and its features of serving national strategies. It also
emphasizes the market-based operation and subjects the bank to general rules
governing the banking industry. All aspects of CDB’s
operation, management and prudential supervision are covered in this
comprehensive Regulation. The
Regulation consists of 9 Chapters with 66 Articles: General Provisions, Market
Positioning, Corporate Governance, Risk Management, Internal Control, Capital
Management, Incentives and Restraints, Supervision and Administration, and
Supplementary Provisions. The following five aspects are highlighted: 1) the
Bank should adhere to its position as a financial institution for development,
focusing on development business with commercial business as a supplement. It
should fulfill its role in mid- and long-term investment and financing and
increase support for key and weak areas of the economy and society; 2) the Bank
should improve the modern financial enterprise system and build a corporate
governance mechanism featuring scientific decision-making, robust
implementation, and effective supervision; 3) the Bank should strengthen its
risk management and internal control by establishing a risk management and
internal control system which is consistent with the banking industry’s general
operation rules and the Bank’s role as a bank for development; 4) the Bank
should set up and develop a capital mechanism based on a sound capital adequacy
ratio; 5) the Bank should strengthen its accountability system and establish an
incentive and restraint mechanism according to the characteristics of
development financing. The
introduction of the Regulation will help improve the supervisory and regulatory
system over CDB and bring the regulation of it under the rule of law. It will
also strengthen the risk control over the Bank and upgrade its capacity for
standardized operation and management to ensure a healthy and sustainable
development. |
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Copyright: China Banking Regulatory Commission |
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