ABSTRACT
Chapter 5 (2003–07) demonstrates how fundamental reforms of bank governance and risk management, led by new banking regulator CBRC, created a much stronger and more resilient banking system. CBRC implemented the full roll-out of an international standard loan classification system, the centralisation and upgrading of the credit approval process and the centralisation of bank IT systems. Through restructuring and listing, Western concepts of corporate governance were adapted alongside a party system that remained deeply embedded within the corporate governance structure of the banks. Minority investors improved the banks’ capacity to manage risk and helped to introduce new products, improve customer service and upgrade business practices.
