中国银行的改革(英文版)

1、Chinas Last Step Across the River: Completing the banking reformAsia Pacific Economic and Market AnalysisSalomon Smith Barney and CitibankandAsia Pacific School of Economics and ManagementAustralian National University1The last-stepsThe past relatively pain-free reform approach is no longer possible

2、New reforms face tougher tasks: giant SOEspillar SOCBsWhy adjustments may be painful?non-state sector small in these sectorsfinancial problems could trigger economy-wide difficulties unemployment pressure2Banking reform has made progressesThe central bank, PBOC, was establishedA complete banking sys

3、tem was developed4 major banks (75% of banking assets) a dozen other commercial banks3 policy banksforeign banks and branchesproposed 10 private banks Financial deepening: M2/GDP ratio (130%)The banks rely mainly on household deposits (70%) and lend mainly to the state sector (70%)3Financial deepeni

4、ng, M2/GDP (%) Note: Numbers for the other economies are for 1998.Source: China Statistical Yearbook, various years; and International Financial Statistics, June 2000 issue.4Declining growth rates of household depositsSources: CEIC.5But bank fragility grewBanking problems caused byLoss-making SOEsPo

5、licy loans (one-third of total outstanding loans)Weak banking institutionsNon-performing loansUnder-capitalization of the banks(comparing to the other Asian economies)6Slow & declining productivity growth (%, p.a.)Source: Salomon Smith Barney Inc. estimates applying enterprise survey data by the Chi

6、nese Academy of Social Sciences.7SOEs profitability falling (%)Sources: State Statistics Bureau of China, China Statistical Yearbook, various years, China Statistics Press, Beijing; anad CEIC.8Banking fragilitySources: Yiping Huang (forthcoming). Chinas Last Steps Crossing the River: Enterprise and

7、banking reforms, Cambridge University Press.9were confirmed by firm data (%)Source: Processed from enterprise survey data by the Chinese Academy of Social Sciences.10New measures adopted to cure the problemsImprovement in financial supervision and regulationCommercialization of the banksNew accounti

8、ng system (loan classification system)Asset Management Companiestransfer, repackage and sell bad loans/assets (Rmb1.4 tr or 19% of outstanding loans)broad business scope: debt-equity swap, restructuring of the SOEs and even underwritingan assessmentPublic listing11But the environment is changing rap

9、idlyEast Asian economies is coming out of recession (except Indonesia)The global economy is slowing down significantlyThis is exacerbated by political unsettlement in AsiaChina is going to join the WTO, hopefully12Assumptions about external situationSlowdown of global economic growth, but no collaps

10、e of US economyStabilization and downward adjustment of oil prices around end of the yearDeepening economic integration across the Taiwan Strait, despite political uncertainties13Global growth slowing but still above trendSource: Citibank/Salomon Smith Barney estimates14Japans steady recovery a boos

11、t for AsiaSource: BloombergFaster growth of Japans trade15What does this mean for China(%)16Domestic factors more criticalDomestic demand account for 95% of GDPConsumer confidence and corporate investment are risingTheir growth rates may not be extraordinary, but are already higher than those of 199

12、8 and similar to those of 1997 Positive impacts of WTO membershipfloods of FDI, growth of exportsNear-term risks:sluggish rural/inland consumptionstructural/geographic unemployment problemsLong-term risk lies in fiscal challenge17Initial turnaround led by export growth18Now, consumer spending is ris

13、ing.CPI deflation ended, but RPI deflation continuesSource: CEIC.(%)19(because of rising consumer confidence)Source: CEIC.20so is corporate investment(%)Growth of industrial production is acceleratingSource: CEIC.21China is to maintain strong growthMacroeconomy is moving upwardChina is less exposed

14、to the external market, compared to other Asian economiesContribution of WTO membership, with a clear example of FDIPlanned fiscal spending22Implications of WTO accessionStill expecting in the first half of 2001Liberalization will take place, including in the banking sectorBoth exports and imports w

15、ill increase, but latter will increase more (current account implication)Economic growth will be helped, by 0.5-2 pps (higher range equivalent to the economy of the size of Singapore or Malaysia)Restructuring challenge: about 40 people will lose job23Entry of foreign banks after WTO accessionImmedia

16、tely, foreign banks will start foreign currency businesses with Chinese enterprises and householdsIn two years, foreign banks will engage in local currency businesses with Chinese enterprisesIn five years, foreign banks will begin local currency businesses with Chinese households 24Foreign bank pene

17、tration, end of 19996 wholly owned banks, 7 joint ventures & 157 branchesTotal assets of foreign banks were $34 billion, or about 2% of the total bank assets in ChinaMost foreign bank operations concentrate in the coastal cities, about half of foreign banks total assets, loans and deposits are held

18、in Shanghai24 in Shanghai and 8 in Shenzhen engaged in the experiment program in local currency businesses25Loan-deposit gaps of foreign banksSources: CEIC.26Stylized facts: experiences of other countriesWhen foreign banks enter, weak domestic banks do lose market share and become less profitableFor

19、eign banks are usually more successful in penetrating credit market than deposit marketPricing competition is often limited until the foreign banks become a significant player in marketForeign bank entry often increases stability of the domestic banking sector as loan growth rises while volatility f

20、allsForeign banks also help improve the efficiency and productivity of domestic banks through competition effect27European transitional economiesSources: Data surveyed in John Bonin and Yiping Huang, Foreign Entry into Chinese Banking: Does WTO membership threats domestic banks?, Paper presented at

21、the International Conference Sustaining Rapid Growth in China in the 21st Century, September 9-10, 2000, Australian National University, Canberra. 28What are likely to happen?Domestic banks will be hit badly, loss ofprofitable corporate clientswealthy retail clientscapable employeesBattlefield will

22、be in the coastal region, about half dozen citiesBut there will be a five-year phase-in periodDomestic banks can find room to breathe and growdevelopment of the interbank marketscompetition effectWorry about rising financial instability ungroundedsupervision of the central bankFDI in banking no diff

23、erent from FDI in industry29Short-term business strategiesKey is to help smooth transition without suppressing competitionAvoid a significant shift of bank deposits (regulation of deposit interest rate)Concentrating on businesses with comparative advantages (network)deposit-takingconsumption loans (

24、car loans and housing mortgage)plastic money (credit and debit cards) and ATMsintegrating banking, insurance, investment, etc 30Need for coordinated reformsReform of the state-owned enterprises and the policy loansTo play the network factor, the IT and accounting systems needs to be improvedAlso imp

25、rovement in supervision by the central bank Ownership reform is necessary, the current strategy appears to favor public listingsmaller banks are either already listed or are on the way to the stock market, bigger ones will probably follow suitean important step forward in changing ownership structur

26、ebut there are important deficiencies in the current regulatory framework of the stock marketIntroduction of foreign strategic investors31Interest rate and exchange rate reformsThe three-year plan for interest rate liberalizationlending rate for $ loans were already liberalized in September 2000libe

27、ralization of Rmb lending rate will be the next stepRmb deposit rate to be regulated for a whileRate hike is unlikely in the coming 3-6 months (despite concern of slow deposit growth), possibility increases in 2H01 as inflation heats up again Capital account liberalization, originally scheduled for

28、2000, is postponedwith strong FDI, immediate gain from liberalization is limited Interest rate reform calls for greater flexibility in exchange ratewidening band of rate fluctuation may be introduced sooncurrent priority is to reform the methods of management, including introduction national treatme

29、nt for both enterprises and individuals32Real exchange rate back to pre-crisis levelSources: IMF, International Financial Statistics, September 2000.33Exchange rate should remain stableCurrently, no pressure for devaluationreturn of real exchange ratedifference between official and black market rate

30、srising and huge foreign exchange reservestrade and current account surplusesAfter WTO, current account may deteriorate in first 2-3 yearsbut import growth should not be over-estimatedBut current account is only part of the balance of payment, FDI inflow will provide offsetting effectAt most, RMB mi

31、ght devalue slightly in 2001 and 2002 but should re-gain strength again after that34Fiscal challenge: falling revenue share. Share of government revenue of GDP declined sharply35and costly last-step reformsSource:Completing Chinas Transition: Banking and Enterprise Reforms, Salomon Smith Barney Inc.

32、, Hong Kong, June 2000. The last steps of reform are very costly36Reforms: revenues and bad debtsDebt/GDP ratio (%)YearSource:Completing Chinas Transition: Banking and Enterprise Reforms, Salomon Smith Barney Inc., Hong Kong, June 2000. 37Although the statements of facts in this report have been obt

33、ained from and are based upon sources the Firm believes to be reliable, we do not guarantee their accuracy, and any such information may be incomplete or condensed. All opinions and estimates included in this report constitute the Firms judgment as of the date of this report and are subject to change without notice. This report is for informational purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of a security.Salomon Smith Barney is a regis