China to merge regulators, create new ministries: parliament document

China to merge regulators, create new ministries: parliament document

State Councillor Wang Yong told delegates of the parliamentary session underway in Beijing that the bureaucratic shuffle was needed to make government more effective and efficient.

The new regulator will be capable of "holding the bottom line to prevent systematic financial risk", the parliament document says.

The China Banking Regulatory Commission and the China Insurance Regulatory Commission have oversight of US$43 trillion in financial assets, according to a report by Bloomberg.

Xi, 64, is set to continue for a life term as the NPC approved the removal of the two-term limit for the president and the vice president.

The two regulators will hand off duties such as proposing laws to the People's Bank of China in a sign that the central bank is beefing up its regulatory role.

"Deepening the reform of state institutions is an inevitable requirement for strengthening the long-term governance of the party", said Liu He, President Xi Jinping's top economic adviser.

The draft also includes a new immigration bureau and changes to the tax system.

The long-awaited measures to tighten the control over the banking and insurance sector of the country, which has a total value of 42 trillion United States dollars, comes amid the authorities' attempts to curb risky credit practices and reduce high corporate indebtedness. Once this happens, the Cabinet will consist of 26 Ministries and Committees.

In much-anticipated plans to create seven new ministries and a raft of government agencies announced on Tuesday, one of the most significant changes was creation of the national markets supervision management bureau.

China's financial system has become increasingly tough to regulate due to its sheer breadth.

There will also be new administrations, such as an worldwide development cooperation agency, a state immigration administration, and a banking and insurance regulatory commission. It has grown rapidly in size and complexity, emerging as one of the world's largest with financial assets at almost 470 percent of gross domestic product, according to the International Monetary Fund.

Many brokerages also structure wealth management products as a channel for hidden bank lending, in addition to the more traditional business of facilitating share trades and investment banking services.

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