China's New Banking Regulator Chief Faces Daunting Challenges
- Rise in shadow banking and bad loans are among risks
- Guo Shuqing said to head China Banking Regulatory Commission
China has appointed Guo Shuqing as the new head of the banking regulator, according to people familiar with the matter. Having spent much of his life working on transforming the nation’s financial system, Guo, 60, faces daunting tasks ahead as he takes on oversight of the world’s largest banking industry by assets. Below are five charts highlighting some of the biggest issues.
Shadow banking is now in every segment of China’s financial system, prompting authorities to work together to address growing risks. The central bank and the securities, banking and insurance regulators are drafting new rules for asset-management products that have swollen to almost $9 trillion as of June 30. So-called wealth-management products issued by banks surged 30 percent last year, making them the largest component of the banking system that exists largely outside of lenders’ balance sheets.