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Approaches to and Measures for Institutional Innovation of Financial Regulation under the New Normal (No 129, 2015)


By Xu Pengcheng, Asset Management Office

Research Report No 129, 2015 (Total 4814)


With the swift expansion of China's financial market and the constant progress of innovative financial services, cross-sector operation has become the development trend for China's financial industry, resulting in enhanced allocation efficiency and accelerated integration of financial market. However, cross-sector operation has posed various challenges to the current sector regulation model of "one central bank plus three commissions" such as inadequate joint regulation and low efficiency, weak industrial self-discipline, and impotent social supervision, affecting to some extent the overall effects of financial regulation. Therefore, this paper suggests that we should adjust the approach to financial regulation, improve the traditional regulatory framework and policies, and achieve unification between functional regulation and institutional regulation, between institutional regulation and service regulation, and between regulatory modules and the systematic function. In addition, we should revise inappropriate items in current regulatory laws and regulations for banking, securities and insurance, and improve the system for financial regulation institutions; we should straighten out the organizational system of financial regulation and establish unified comprehensive regulatory organizations; we should also strengthen building of financial information system, increase transparency of financial information and effectively ward off systematic risks.