![]() Headquarters of the Bank in Beijing | |
Headquarters | |
---|---|
Coordinates | Beijing 39°54′24″N116°21′14″E / 39.90667°N 116.35389°E |
Established | December 1, 1948 |
Key people | |
Central bank of | China |
Currency | Renminbi (RMB) CNY (ISO 4217) |
Reserves | US$3.45 trillion (2023) [1] |
Reserve requirements | 7% [2] |
Bank rate | 3.4% |
Website | www |
People's Bank of China | |||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Chinese name | |||||||||||||||||||||
Simplified Chinese | 中国人民银行 | ||||||||||||||||||||
Traditional Chinese | 中國人民銀行 | ||||||||||||||||||||
Literal meaning | China People Bank | ||||||||||||||||||||
| |||||||||||||||||||||
Alternative Chinese name | |||||||||||||||||||||
Simplified Chinese | 人民银行 | ||||||||||||||||||||
Traditional Chinese | 人民銀行 | ||||||||||||||||||||
Literal meaning | People Bank | ||||||||||||||||||||
| |||||||||||||||||||||
Second alternative Chinese name | |||||||||||||||||||||
Chinese | 央行 | ||||||||||||||||||||
Literal meaning | Central Bank | ||||||||||||||||||||
| |||||||||||||||||||||
Tibetan name | |||||||||||||||||||||
Tibetan | ཀྲུང་གོ་མི་དམངས། མི་རྣམས།དངུལ་ཁང་། | ||||||||||||||||||||
| |||||||||||||||||||||
Zhuang name | |||||||||||||||||||||
Zhuang | Cunghgoz Yinzminz Yinzhangz | ||||||||||||||||||||
Mongolian name | |||||||||||||||||||||
Mongolian Cyrillic | ДундадУлсынАрдынБанк | ||||||||||||||||||||
Mongolian script | ᠳᠤᠮᠳᠠᠳᠤ ᠤᠯᠤᠰ ᠤᠨ ᠠᠷᠠᠳ ᠤᠨ ᠪᠠᠩᠬᠢ | ||||||||||||||||||||
| |||||||||||||||||||||
Uyghur name | |||||||||||||||||||||
Uyghur | جۇڭگو خەلق بانكا | ||||||||||||||||||||
| |||||||||||||||||||||
Portuguese name | |||||||||||||||||||||
Portuguese | Banco Popular da China |
![]() |
---|
![]() |
The People's Bank of China (officially PBC [3] and unofficially PBOC [4] ) is the central bank of the People's Republic of China. [5] It is responsible for carrying out monetary policy as determined by the People's Bank Law and the Commercial Bank Law.
The PBC was established in 1948 and became China's sole central bank after the founding of the People's Republic of China in 1949. From 1969 to 1978, the PBC was demoted to a bureau of the Ministry of Finance. The PBC was extensively reformed during the 1990s, when its provincial and local branches were abolished, instead opening nine regional branches. In 2023, these reforms were reversed as when the regional branches were abolished and the provincial branches restored, and new arrangements essentially ended the PBC's longstanding role in financial supervision.
The PBC is the 25th-ranked of 26 ministerial-level departments of the State Council, right ahead of the National Audit Office. The PBC lacks central bank independence, and is required to implement the policies of the Chinese Communist Party (CCP) under the direction of the party's Central Financial Commission. The PBC is led by a Governor assisted by several Deputy Governors and a CCP Committee Secretary. Since 2023, the roles of Governor and CCP Committee Secretary have been held jointly by Pan Gongsheng.
The bank was established on December 1, 1948, based on the consolidation of the Huabei Bank, the Beihai Bank and Northwestern Farmers' Bank. [6] : 37 The headquarters was first located in Shijiazhuang, Hebei, and then moved to Beijing in 1949. Between 1950 and 1978 the PBC was the only bank in the People's Republic of China and was responsible for both central banking and commercial banking operations. [7] : 225 All other banks within mainland China such as the Bank of China were either organized as divisions of the PBC [8] or were non-deposit taking agencies. [9] [10]
From 1952 to 1955 government shares were added to private banks to make state-private banks, until under the first Five Year plan from 1955 to 1959 the PBC had complete control of the private banks, making them branches of the PBC, closely resembling the vision of Vladimir Lenin.[ citation needed ] With aid from the Soviet Union, the shares of private enterprises and with them industrial output followed a similar path, forming a Soviet-style planned economy.
During the Cultural Revolution, the PBC suspended its commercial banking service. [6] : 38 In June 1969, the State Council approved the consolidation of PBC's headquarters as a bureau within the Ministry of Finance. [6] : 38 In that context, the PBC's head office was downsized to no more than eighty staff. [5] : 58 Local PBC branches were correspondingly merged into local government finance departments. [6] : 38
The institutional demotion of the PBC was reversed in March 1978 as it was separated from the Finance Ministry and granted ministerial ranking. [5] : 62
By then and with the exception of special allocations for rural development, the monolithic PBC dominated all business transactions and credit. In 1979, China initiated a transition from that single-tier banking system to a two-tier system, which was largely completed by 1984. [11] : 188–189 In March 1979, as part of the Chinese economic reforms, the State Council split off state-owned banks from the PBC, first the Agricultural Bank of China (ABC) and the Bank of China (BOC). The People's Construction Bank of China, which had been run separately under the Ministry of Finance, was also made autonomous (and later renamed China Construction Bank in 1986). In January 1984, the PBC's own commercial banking operations were spun off as the Industrial and Commercial Bank of China (ICBC). [5] : 63 [12] In September 1983, the State Council had promulgated that the PBC would function exclusively as the central bank of China and no longer undertake commercial banking activities. [6] : 42
Modernization efforts continued in the late 1980s and early 1990s. In 1990, the PBC moved into its new head office building, prominently located on West Chang'an Avenue. [13] : 47 In 1991, vice governor Chen Yuan spearheaded the creation of the Electronic Interbank System (EIS), the PBC's first state-of-the-art financial market infrastructure. [5] : 285 In 1992, however, the PBC had to reluctantly concede the spinning off of its securities regulatory duties to the newly established China Securities Regulatory Commission, [5] : 149 whose first chair was former PBC vice governor Liu Hongru.
The bank's profile was greatly raised by the appointment of Zhu Rongji as its Governor in 1993, simultaneously as his role as Vice Premier in charge of economic and financial affairs. [5] : 125 . Its central bank status was legally confirmed on March 18, 1995, by the 3rd Plenum of the 8th National People's Congress, and was granted a higher degree of autonomy than other State Council ministries by an act that year. [11] : 203 In 1996 and 1996, the PBC established fundamental regulations on loans and consumer credit. [14] : 20
In 1998, the PBC underwent a major restructuring. All provincial and local branches were abolished, and the PBC opened nine regional branches, whose boundaries did not correspond to local administrative boundaries. [15] The nine branches were located in Chengdu, Guangzhou, Jinan, Nanjing, Shanghai, Shenyang, Tianjin, Wuhan, and Xi'an, complemented by a sub-provincial network of city-level and county-level sub-branches. [5] : 144 That same year, the so-called credit plan, a key feature of China's former state planning process, was finally abandoned, allowing the PBC to play a genuine role as monetary policy authority. [5] : 99
In 2003, the Standing Committee of the National People's Congress approved an amendment law for strengthening the role of PBC in the making and implementation of monetary policy for safeguarding the overall financial stability and provision of financial services.[ citation needed ] That year, the long overdue restructuring of China's banking sector made major progress with the creation of Central Huijin Investment, a PBC-managed fund that allowed the PBC to take the lead from the Ministry of Finance on the restructuring process and from the CCP Central Organization Department on the appointment of senior bank executives. [5] : 279-281 That same year, however, the PBC reluctantly lost its direct authority over banking supervision with the creation of the China Banking Regulatory Commission. [5] : 149
In 2005, the PBC elevated its branch in Shanghai to the status of "second head office", in a move intended to mirror the prominent market-facing role of the Federal Reserve Bank of New York within the US Federal Reserve System. [5] : 123 In 2006, the PBC established the Credit Reference Centre to provide financial credit reporting. [14] : 47 In 2008, the PBC lost the direct ownership stakes it had built up in much of China's financial sector as the ownership of Central Huijin was transferred to the China Investment Corporation (CIC), a newly created sovereign wealth fund. [5] : 287
During the Great Recession, the PBC helped address bank liquidity crisis by signing swap agreements with numerous other countries to provide them with liquidity based on the renminbi. [16] : 267 As of 2021 [update] , China has swap agreements with 40 countries. [16] : 271
In 2010, the PBC issued administrative measures regarding online non-financial payment services. [17] : 33 These measures retroactively recognized the legal status of online third-party payment platforms like Alipay. [17] : 33 Prior to the 2010 measures, these services existed in a legal grey area. [17] : 32
In 2015, the PBC hosted China's first formal deposit insurance scheme. [18] In 2019, this scheme was reorganized as a subsidiary of the PBC, the Deposit Insurance Fund Management Company. [19] Meanwhile, in 2017, the PBC was tasked with the secretariat of China's newly established Financial Stability and Development Committee chaired by Vice Premier Liu He. In 2020, the PBC initiated supervision of significant financial holding companies. [20] : 6–7
The PBC underwent through another major restructuring in 2023, with the abolition of the nine regional branches established in 1998, which had already seen their authority watered down by a change in 2004 that had returned authority to the PBC's branches at the provincial level and further changes in 2018. [21] [15] Additionally, the PBC's county-level branches were absorbed by city-level branches. [22] The new branches were inaugurated on August 18, 2023. [23] The oversight over financial holding companies and financial consumer protection was also transferred from the PBC to the newly established National Financial Regulatory Administration (NFRA). [22] Around 1,600 county-level branches of the PBC are planned to be absorbed to the NFRA; the PBC had 1,761 such branches at the end of 2021. [24]
The PBC is a cabinet-level executive department of the State Council. [11] : 203 The top management of the PBC are composed of the governor and a certain number of deputy governors. The governor is nominated by the premier of the State Council, who is then approved by the National People's Congress or its Standing Committee and appointed by the president.The deputy governors of the PBC are appointed to or removed from office by the premier. [25]
The PBC adopts the governor responsibility system under which the governor supervises the overall work of the PBC while the deputy governors provide assistance to the governor to fulfill his or her responsibility. The current governor is Pan Gongsheng. Deputy governors of the management team include: Zhu Hexin, Zhang Qingsong, Xuan Changneng, Lu Lei, and Tao Ling. [26]
The PBC does not have central bank independence and is politically required to implement the policies of the Chinese Communist Party (CCP). [27] It operates under the direction of the CCP's Central Financial Commission. [24] The CCP committee secretary of the PBC is the most powerful position in the bank and can hold more sway than the governor. The current CCP committee secretary is Pan Gongsheng. [28]
The PBC has branches in each 31 provincial-level administrative divisions in China, branches in five cities (Shenzhen, Dalian, Ningbo, Qingdao, and Xiamen), and 317 branches in prefecture-level divisions. [23] It has 6 overseas representative offices (PBC Representative Office for America, PBC Representative Office (London) for Europe, PBC Tokyo Representative Office, PBC Frankfurt Representative Office, PBC Representative Office for Africa, Liaison Office of the PBC in the Caribbean Development Bank).
The PBC Monetary Policy Committee is an advisory body chaired by the PBC governor. It typically includes the directors and deputy directors of other financial agencies, as well as a few influential academic economists. [29]
As of 2019 [update] , the PBC consisted of functional departments (bureaus) as below: [30]
The following enterprises and institutions were directly under the PBC as of 2012: [31]
The PBC is active in promoting financial inclusion policy and a member of the Alliance for Financial Inclusion. [32]
The head office building of the PBC, on West Chang'an Avenue, was constructed in 1987–1990 on a design by a team of architects led by Zhou Ru. [13] : 49 While its materials are modern, its shape refers to two traditional Chinese motifs, namely yuanbao ingots and "wealth vases" (Chinese :Jùbǎopén) from Chinese folklore. [13] : 176
A central bank, reserve bank, national bank, or monetary authority is an institution that manages the currency and monetary policy of a country or monetary union. In contrast to a commercial bank, a central bank possesses a monopoly on increasing the monetary base. Many central banks also have supervisory or regulatory powers to ensure the stability of commercial banks in their jurisdiction, to prevent bank runs, and in some cases also to enforce policies on financial consumer protection and against bank fraud, money laundering, or terrorism financing.
The Federal Reserve System is the central banking system of the United States. It was created on December 23, 1913, with the enactment of the Federal Reserve Act, after a series of financial panics led to the desire for central control of the monetary system in order to alleviate financial crises. Over the years, events such as the Great Depression in the 1930s and the Great Recession during the 2000s have led to the expansion of the roles and responsibilities of the Federal Reserve System.
Zhu Rongji is a retired Chinese politician who served as the premier of China from 1998 to 2003 and member of the Politburo Standing Committee of the Chinese Communist Party (CCP) from 1992 to 2002 along with CCP general secretary Jiang Zemin.
The Reserve Bank of India, abbreviated as RBI, is India's central bank and regulatory body responsible for regulation of the Indian banking system. Owned by the Ministry of Finance, Government of India, it is responsible for the control, issue and maintaining supply of the Indian rupee. It also manages the country's main payment systems and works to promote its economic development. Bharatiya Reserve Bank Note Mudran (BRBNM) is a specialised division of RBI through which it prints and mints Indian currency notes (INR) in two of its currency printing presses located in Mysore and Salboni. The RBI, along with the Indian Banks' Association, established the National Payments Corporation of India to promote and regulate the payment and settlement systems in India. Deposit Insurance and Credit Guarantee Corporation was established by RBI as one of its specialized division for the purpose of providing insurance of deposits and guaranteeing of credit facilities to all Indian banks.
The Ministry of Finance of the People's Republic of China is the constituent department of the State Council of the People's Republic of China which administers macroeconomic policies and the annual budget. It also handles fiscal policy, economic regulations and government expenditure for the state.
The Industrial and Commercial Bank of China is the largest bank in China, and in the world, by total assets as of April 2024. ICBC was created on 1 January 1984 from what were then the commercial banking operations of the People's Bank of China. ICBC is majority-owned by the Chinese government and has remained so after its landmark initial public offering in 2006. As of end-2021, ICBC shareholders included Central Huijin Investment, the Chinese Ministry of Finance, the National Council for Social Security Fund, adding up to 69.3 percent under the ultimate control of the Ministry of Finance.
The Bangko Sentral ng Pilipinas is the central bank of the Philippines. It was established on July 3, 1993, pursuant to the provision of Republic Act 7653 or the New Central Bank Act of 1993 as amended by Republic Act 11211 or the New Central Bank Act of 2019. The principal author was Senator Franklin Drilon. It was signed by President Rodrigo Duterte.
Bangladesh Bank is the central bank of Bangladesh and is a member of the Asian Clearing Union. It is fully owned by the Government of Bangladesh.
Yi Gang is a Chinese economist who served as the governor of the People's Bank of China from 2018 to 2023, vice governor of the People's Bank of China from 2007 to 2018, director of the State Administration of Foreign Exchange from 2009 to 2015, and assistant governor of the People's Bank of China from 2004 to 2007.
The State Administration of Foreign Exchange (SAFE) of the People's Republic of China is an administrative agency under the State Council tasked with drafting rules and regulations governing foreign exchange market activities, and managing the state foreign-exchange reserves, which at the end of December 2016 stood at $3.01 trillion for the People's Bank of China. The current director is Zhu Hexin.
The Bank of Ghana is the Central Bank of Ghana. It is located in Accra and was formed in 1957. The Bank of Ghana has Seven Regional Offices in addition to its head office in Accra. The regional offices are located in the following cities, Hohoe, Kumasi, Sunyani, Tamale, Takoradi, Bolgatanga, Wa. The regional offices are responsible for implementing the policies and directives of the Bank of Ghana in their respective regions. They also provide banking services to the government, financial institutions, and the public.
The Central Bank of Somalia (CBS) is the monetary authority of Somalia. Somalia has struggled to reestablish a functioning state since the collapse of an authoritarian regime in 1991. Somalia has been cited as a real-world example of an anarchist stateless society and a country with no formal legal system. The Transitional Federal Government, formed in 2004, was recognized as the central government of Somalia. Among other duties, it is in charge of ensuring financial stability, maintaining the internal and external value of the local currency, and promoting credit and exchange conditions that facilitate the balanced growth of the national economy. Within the scope of its powers, it also contributes to the financial and economic policies of the State.
China's banking sector had CN¥319.7 trillion in assets at the end of 2020. The "Big Four" state-owned commercial banks are the Bank of China, the China Construction Bank, the Industrial and Commercial Bank of China, and the Agricultural Bank of China, all of which are among the largest banks in the world as of 2018. Other notable big and also the largest banks in the world are China Merchants Bank and Ping An Bank.
Dai Xianglong is a Chinese politician. He is the former governor of the People's Bank of China, and the former mayor of Tianjin. He currently serves as the president and Chinese Communist Party (CCP) party chief of the National Council for Social Security Fund.
The governor of the People's Bank of China is the head of the People's Bank of China and one of the country's key economic decisionmakers.
The constituent departments of the State Council are the principal units of State Council of the People's Republic of China. Types of departments include ministries, commissions, the People's Bank of China and the National Audit Office.
The monetary policy of China aims to keep the value of the Renminbi, the official currency of the People's Republic of China, stable and contribute to economic growth. Monetary policy concerns the actions of a central bank or other regulatory authorities adopt to manage and regulate currency and credit in order to achieve certain macroeconomic goals.
Pan Gongsheng is a Chinese economist and politician who is the current Chinese Communist Party Committee Secretary and governor of the People's Bank of China (PBC). He served as the Director of the State Administration of Foreign Exchange from 2016 to 2023. At the PBC, he has worked on the monetary policy of China.
Cai Esheng is a retired Chinese politician who served as vice president of the China Banking Regulatory Commission between 2005 and 2013. He has retired for 8 years. As of July 2021 he was under investigation by China's top anti-corruption agency.
Xie Ping is a prominent Chinese financial policymaker. A former senior official of the People's Bank of China and Deputy General Manager of China Investment Corporation, he has more recently been a professor at the PBC School of Finance at Tsinghua University. He was the first General Manager of Central Huijin Investment after that entity was established in 2003, while Guo Shuqing was chairman.
Beijing has little tolerance for any talk of central-bank independence; the monetary authority, just like any other part of the government, answers to the party.