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Policy Options for Fleshing out Across-the-Board Capital Management and Keeping Financial Sector on Track to Serve the Real Economy (No.115, 2018)


By Xu Pengcheng, Assets Management Office, DRC

Research Report, No.115, 2018 (Total 5390) 2018-7-20

Abstract: Financial asset management has registered a rapid development over recent years, whereas a long-term lack of a universal administrative system and regulatory mechanism has resulted in many serious problems and one of the direct consequences is its impact on the development of real economy. Serving the real economy is the principal function of financial sector, and the better regulation of financial asset management will enable financial industry to contribute more to the development of real economy. To this end, actions should be taken by the regulatory departments to push ahead with the process of financial services for real economy. First, comprehensive regulation should be implemented to ensure that systemic risks could be averted. Second, policy guidance should be enhanced to strengthen the support for real economy. Third, functional regulation should be innovated in order to improve the coordination between monetary policy and macro-prudent policy. Fourth, consciousness of risk management should be reinforced and misunderstandings about rigid payment should be removed. In the meantime, financial institutions should be clear about their roles and step up their efforts in serving the real economy, and real economy is also supposed to go further through reform to increase returns on investment so as to attract and pool more funds.

Key words: asset management, real economy, reform of financial sector