What are the focus points for comprehensively strengthening financial supervision in 2023?

2023 is a landmark year in the history of my country’s financial industry supervision.

This year, the trend of strong supervision and strict supervision continued, the “iron fence” of the regulatory system was tightened, and financial supervision was comprehensively strengthened to provide a strong guarantee for preventing and defusing financial risks and serving the high-quality development of the real economy.

The new pattern of financial supervision is taking shape faster

In 2023, my country’s financial supervision field will usher in major reforms.

In March, the Central Committee of the Communist Party of China and the State Council issued the “Plan for the Reform of Party and State Institutions”, many of which involve financial supervision: the establishment of the Central Financial Commission, the establishment of the Central Financial Working Committee, the establishment of the State Financial Supervision and Administration, deepening the reform of local financial supervision systems, China The Securities Regulatory Commission was restructured into an agency directly under the State Council, coordinating and promoting the reform of the branches of the People’s Bank of China… The intensity of the reform is unprecedented in recent years.

Subsequently, relevant reforms were further advanced: on May 18, the State Administration of Financial Supervision was officially listed; on July 20, the State Administration of Financial Supervision unified 31 provincial-level regulatory bureaus, 5 municipal regulatory bureaus under separate state planning, and 306 prefecture-level regulatory branches. Listed; on August 18, 31 provincial (autonomous regions, municipalities) branches of the People’s Bank of China, 5 branches of cities with separate state plans, and 317 prefecture (city) branches were unified listed; on November 10, the “State Administration of Financial Supervision and the China Securities Regulatory Commission” The “Three Certainties” plans were introduced separately.

Dong Ximiao, a researcher at the Institute of Financial Studies at Fudan University, said that through the adjustment of organizational structure and optimization of responsibilities, the new financial supervision pattern of “one bank, one bureau, one meeting” has accelerated, and various financial activities have been included in supervision in accordance with the law, achieving full coverage of financial supervision.

Zeng Gang, director of the Shanghai Finance and Development Laboratory, said that based on the continuous improvement of the regulatory framework, continued efforts need to be made in strengthening the construction of the behavioral supervision system, strengthening macro-prudential and micro-prudential coordination, and improving regulatory professional capabilities. This will lay a solid foundation for improving the efficiency of financial supervision, promoting the smooth operation of the financial industry, and better serving the real economy.

Regulatory “board” hits the mark accurately and painfully

In 2023, under the general tone of strong supervision and strict supervision, financial regulatory authorities will take action against chaos in the financial market, strictly enforce the law and dare to use their swords, and supervision will be more precise and powerful.

On December 1, the State Administration of Financial Supervision announced 22 fines against a number of financial institutions, involving major state-owned banks, joint-stock banks, insurance companies, etc., with illegal gains confiscated and fines totaling more than 300 million yuan.

In the securities field, the China Securities Regulatory Commission has stepped up its crackdown on financial fraud, fraudulent issuances, market manipulation and other illegal activities, and the intensity and speed of punishment have been significantly increased compared with the past. The number of investigations filed against listed companies in 2023 will increase by about 20% compared with 2022.

“Since the beginning of this year, the financial regulatory authorities have continued to strengthen supervision. The number of fined institutions has increased, and large fines have increased, which has released the determination to intensify efforts to promote the standardized development of the financial industry.” said Zhao Xijun, co-dean of the China Capital Market Research Institute at Renmin University of China. .

“Increasing the intensity of penalties is a direct manifestation of the ‘tusks and thorns’ of supervision.” Zeng Gang said that financial institutions’ violations and motivations often depend on the balance between the costs of violations and the corresponding benefits. By raising the cost of non-compliance for financial institutions and their executives, the regulatory effect can be achieved so that they dare not violate regulations.

Non-compliance in the management of related-party loans, insufficient disclosure of information on major related-party transactions, and transfer of interests between wealth management products… Various violations of laws and regulations reflect that there is still room for improvement in financial institutions’ compliance operations and risk control capabilities.

Judging from the signals released by the financial regulatory authorities, the next regulatory action will focus on the “key matters” that affect financial stability, the “key people” that cause major financial risks, and the “key behaviors” that disrupt the market order, and truly break the “board”. Be accurate and inflict pain to enhance the deterrent effect of supervision.

Continuously tightening the “iron fence” of the system

On December 17, the “Regulations on the Supervision and Administration of Non-Bank Payment Institutions” was officially announced, further bringing non-bank payment institutions and their business activities with an annual transaction volume of nearly 400 trillion yuan into legal supervision.

On September 21, 2022, the audience visited and experienced the “Financial Knowledge Convenience Store” located in Raffles City Chongqing.Photo by Xinhua News Agency reporter Wang Quanchao

In recent years, with the development of the financial market, new business formats, new businesses, and new entities have continued to emerge, requiring financial legislation to keep pace with the times, make up for the shortcomings of the system, and eliminate regulatory gaps and blind spots.

Accelerating the establishment of rules and regulations and continuously tightening the “iron fence” of the system will become a prominent feature of the financial supervision field in 2023.

“Capital Management Measures for Commercial Banks”, “Interim Measures for the Supervision and Administration of Pension Insurance Companies”, “Measures for the Assessment of Systemically Important Insurance Companies”… Since the beginning of this year, regulatory systems involving various financial institutions have been intensively introduced.

“In response to the development changes and practical needs of the financial business, legislation in key financial areas and emerging areas has been advanced in a timely manner, providing a strong guarantee for the implementation of financial supervision and escorting the stable and healthy development of the financial industry.” Dong Ximiao said.

To strengthen regulatory guarantees, in addition to improving the system, it is also necessary to create a professional regulatory team that is loyal, clean and responsible. Since the beginning of this year, anti-corruption efforts in the financial industry have continued to increase, and the number of people surveyed has increased significantly compared with last year, reflecting my country’s firm determination to purify the financial market environment. Judging from the information released by the financial regulatory authorities, adhering to the inward direction and strengthening “supervision of supervision” will become a major focus of comprehensively strengthening financial supervision in the future.

Effectively prevent and control financial risks

Risk prevention is the eternal theme of financial work and the direct purpose of financial supervision.

Issue special bonds for small and medium-sized banks to replenish the capital of small and medium-sized banks; adjust and optimize real estate credit policies; establish a long-term mechanism to prevent and resolve local debt risks… Since the beginning of this year, under the escort of financial supervision, all work to prevent and resolve risks has been advanced in an orderly manner. my country The financial industry operates generally stably and has strong overall risk resistance capabilities.

As of the end of the third quarter, the non-performing loan ratio of commercial banks was 1.61%, the provision coverage ratio was 207.89%, the capital adequacy ratio was 14.77%, and the insurance industry’s comprehensive solvency adequacy ratio was 194%.

Coordinating development and security is the key to doing good financial work.

Launch 25 specific measures to continue to strengthen financial services for private enterprises; further improve the green finance statistical monitoring and assessment evaluation system; and meet the reasonable financing needs of real estate companies of different ownerships without discrimination… In 2023, under the guidance of financial supervision, financial resources will flow to key areas and weak links, further improving the quality and efficiency of serving the real economy.

“With the comprehensive strengthening of financial supervision, the prevention and control of financial risks will be more effective and effective, and finance will provide higher-quality services for economic and social development.” said Yin Zhentao, a researcher at the Institute of Finance of the Chinese Academy of Social Sciences.

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