Stockholding system in State banks planned
(China Daily)
Updated: 2004-03-03 10:48

China will establish a stockholding system in two State-owned commercial banks, the Bank of China (BOC) and China Construction Bank (CCB), in three years to diversify their investment channels and build them into commercial banks with international competitiveness.

An executive meeting of the State Council presided over by Premier Wen Jiabao outlined the targets and tasks of the reform on March 2 in Beijing.

The reform aims to set up a corporate governance system and invite investment from both home and abroad, officials said.

The two banks should have all necessary elements of a standard joint-stock bank, for example, the general meeting of shareholders, board of directors and board of supervisors.

The banks will be required to establish an effective decision-making mechanism as they have full authority for management and full responsibility over their own profits and losses.

The banks should also handle non-performing assets properly and take responsibility for preserving and increasing the value of the state investment.