China defines banks that are ‘too big to fall’http://chinaeconomicreview.com/china-defines-banks-that-are-too-big-to-fall/http://www.caixinglobal.com/2020-12-04/china-defines-banks-that-are-too-big-to-fall-101635429.html"
China’s central bank and top banking industry regulator released a set of guidelines Thursday for assessing banks that should be deemed systemically important, reported Caixin.
The document outlines how systemically important banks should be graded and sets requirements for their information disclosure. Banks with systemic importance will be selected from the country’s top 30 banks by assets including policy banks and commercial lenders as well as those that have been previously deemed systemically important, according to the document.
Regulators will grade the banks every year and submit a final list to the State Council’s Financial Stability Board for approval, according to the document.
The latest document fleshes out details for assessing systemically important banks following the release in 2018 of a general regulation for financial institutions with crucial industry influence, said Caixin.
Experts said about 20 banks are likely to be defined as systemically important in China under the latest rules, mostly banks with at least RMB 2 trillion ($305 billion) of assets.
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