December 27, 2022
BEIJING/SHANGHAI : Chinese regulators published a set of rules on Tuesday to assess the operational risks of foreign banks’ Chinese branches, as well as the level of support they receive from their global headquarters.
The China Banking and Insurance Regulatory Commission (CBIRC) said the rating system is designed to better allocate supervisory resources, and promote healthy development of foreign banks in China.
Based on the annual assessment results, Chinese regulators will instruct poorly rated foreign banks to improve their corporate governance, the CBIRC said in a statement on its website.
Foreign banks, including HSBC and Citi, have set up more than 40 China units, and over 100 local branches in China, according to official data.
Chinese regulators will assess foreign banks’ risk management, operational control, compliance and asset quality, the CBIRC said.
In addition, the regulator will also evaluate whether foreign banks’ headquarters have the ability and willingness to provide adequate financial and management support to their China branches.
Source: Reuters
