China News Service, October 16th. According to the news from the central bank’s website on the 16th, the central bank drafted the "Commercial Banking Law of the People’s Republic of China (Revised Draft)" (hereinafter referred to as the "Revised Draft"). The "Proposal Draft" intends to improve the market access conditions for commercial banks, increase the requirements for shareholder qualifications and prohibitions; make authoritative provisions on the classified access conditions of commercial banks; make provisions on guiding the professional development of commercial banks and differentiated risk supervision requirements, etc. Specific provisions.
The "Revision Draft" has 11 chapters and 127 articles, of which four chapters have been newly established or enriched after the integration, covering corporate governance, capital and risk management, customer rights protection, risk handling and market exit.
The main changes are as follows.
(1) Improve the types of commercial banks and expand the scope of legislative adjustments.
Clarify the legal status of rural banks and reserve legal space for the emergence of new commercial banks in the future.
It is clarified that policy banks, rural credit cooperatives, rural cooperative banks, financial companies, etc., which handle commercial banking business shall apply the relevant provisions of this law and embody the principle of functional supervision.
(2) Establish a classified access and differentiated supervision mechanism.
Improve market access conditions for commercial banks, and increase regulations on shareholder qualifications and prohibitions.
Authorization provisions shall be made on the classified access conditions of commercial banks.
Make specific provisions on guiding the professional development of commercial banks and differentiated risk supervision requirements.
(3) Improve the corporate governance of commercial banks.
The third chapter "Corporate Governance of Commercial Banks" is newly established to absorb the beneficial practices in the current regulatory system, refer to international experience, and implement the requirements of corporate governance of commercial banks.
Add shareholder obligations and shareholder prohibitions.
Highlight the core role of the board of directors, and regulate matters such as board committees and independent directors.
Enhance the independence and supervisory role of the board of supervisors, and establish a reporting mechanism for the board of supervisors to regulatory agencies.
Improve internal control, standardize incentive and restraint mechanisms, information disclosure and related party transaction management.
(4) Strengthen capital and risk management.
The fourth chapter "Capital and Risk Management" was newly established to implement the capital regulatory requirements of the Basel III Agreement, establish the principle of capital constraints, and clarify the requirements for macro-prudential management and risk supervision.
(5) Improve business operation rules and highlight financial services to the real economy.
The original Chapter 3 and Chapter 4 are integrated and enriched into Chapter 5 "Business Operation Rules".
Improve the business scope and business rules of commercial banks.
Clarify the localized operation requirements of regional commercial banks, and promote commercial banks to base themselves locally and return to their origins.
Respect commercial banks’ autonomous management rights and market players’ status, reduce unnecessary administrative constraints, improve financial services’ real economic capabilities, delete the original Article 36 provision that borrowers need to provide guarantees in principle; modify the interest rate regulations to allow both parties to agree independently Deposit and loan interest rates; establish a credit review due diligence exemption system; extend the time limit for commercial banks to dispose of collateral; delete the rule that enterprises can only open one basic account.
(6) Regulate the protection of customer rights.
The sixth chapter "Protection of Customer Rights and Interests" is newly established, which makes specific provisions on customer protection regulations such as commercial bank marketing, information disclosure, risk classification and appropriateness management, personal information protection, and fee management.
(7) Improve risk handling and market exit mechanisms.
The original Chapter 7 is integrated and enriched into Chapter 9 "Risk Disposal and Market Exit", with reference to international standards, summarizing my country’s banking disposal experience, establishing risk ratings and warnings, early corrections, restructuring, takeovers, bankruptcies, and other orderly disposals and exits Mechanism, standardize disposal procedures, strict disposal conditions, and improve the division of functions.
Provisions are made on the finality of settlement, termination of net settlement, and bridge commercial banks.
(8) Increase penalties for violations.
The penalties for violations were expanded, and penalties for shareholders of commercial banks, actual controllers, and persons directly responsible for risk events were added.
Introduce measures such as restrictions on shareholder rights and remuneration deductions to strengthen accountability.
Raise the upper limit of fines to enhance legislative enforcement and supervision effectiveness.