• ISSN: 2155-7950
  • Journal of Business and Economics

An Overview of the Chinese Banking System: Its History,

Challenges and Risks

Lili Chen, Stan Vinson
(Lander University, USA)
Abstract: This paper is an initial review of the history, evolution and current status of the Chinese Banking Industry. Early conclusions are that the industry segment has been rapidly restructuring and changing since 1979 when Deng Xiaoping implemented major market reforms and that these changes have accelerated with the Country’s entrance into World Trade Organization (WTO) in 2001. Evolving from a single government-controlled institution that acted both as a central and commercial bank, to multiple organizations dominated by market fundamentals and increasing competition, these changes have created several challenges for Chinese financial institutions. The preliminary conclusion is that the role Chinese banks will play in future economic development will be dictated by how well the banks are able to adapt to the new market risk and competition created by market reforms.
Key words: Chinese banking system; history; evolution; challenges; risks
JEL codes: N, O

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