Foreign Banks in China: Start of a New Stage

DOI: 10.20542/0131-2227-2021-65-6-71-78
A. Vdovin (,
MGIMO University, 76, Vernadskogo Prosp., Moscow, 119454, Russian Federation

Received 16.10.2020.

Abstract. The article examines the most recent developments in the evolution of the foreign banks in China. Author provides a brief description of the stages of development of foreign banks in the PRC since the start of the Den Xiaopin’s Reform and Development policy till the present time. The change in assets of foreign banks for the last 15 years is analyzed in details. A comparison of assets of foreign banks with the assets of the China banking system is provided in a form of analytical graph. The author’s assessments of the foreign banking sector over the past ten years give grounds to conclude that there was a stagnation in the development of the foreign banks sector during this period. The recent steps of the Chinese authorities to liberalize the foreign banking sector are analyzed in detail. The author examines the Chinese leader’s systematic approach to the banking reforms and comes to the idea that it consists of three components: the change in the political vision and attitudes, the institution reform of the banking regulators and the reform of banking legislation. An assessment of the impact of liberalization on the development prospects of foreign capital banks is also given. Based on an analysis of the overall scale and impact of recent reforms in the foreign banking sector, the author concludes that a new stage in the development of foreign capital banks in China is likely to begin. The main problems and challenges that foreign banks in China will have to face at a new stage of development are also identified and described.

Keywords: foreign banks, banking system, banking regulator, CBRC, economy, finance, banking assets, liberalization, China


1. China Banking Regulatory Commission 2013 Annual Report. Beijing, CITIC Press, September 2014, pp. 40-50. (In Chin.)

2. China Banking Regulatory Commission 2014 Annual Report. Beijing, China Financial Publishing House, April 2015. 45 p. (In Chin.)

3. Total Assets of Foreign Banks, Insurers in China Top 5 Trillion Yuan. Xinhuanet, 25.05.2020.

4. Guo Shuqing: In the near future, it plans to introduce 12 new measures to open the banking and insurance industry to the outside world. 01.05.2019. (In Chin.) Available at: (accessed 06.09.2020).

5. Regulations of People’s Republic of China on Administration of Foreign Funded Bank. 29.12.2019. (In Chin.) Available at: (accessed 06.09.2020).

6. China’s Finance World Opens up to Foreigners, Sort of. Bloomberg News, 23.01.2020. Available at: (accessed 26.09.2020).

7. Foreign Banks and Insurers Granted Greater China Market Access. China Tax Alert, no. 32, October 24, 2019. Available at: (accessed 16.08.2020).

8. At a Glance: China’s further Opening up of Financial Markets and Tax Updates for the Banking and Capital Markets Sector. News Flash. China Financial Services Tax, May 2019. Available at: (accessed 06.09.2020).

9. Jiang Xueqing. Regulatory Norms for Foreign Banks Revised., 27.12.2019. Available at: (accessed 10.08.2020).

10. Maysami R. C., Bahhouth V. Foreign Banks in China: Critical Success Factors and Lessons Learnt. Pembroke, University of North Carolina. Available at: (accessed 13.01.2021).

11. Wang Y., Chenavaz R. The Entry of International Banks in China. Journal of Applied Business Research, 2016, no. 32. Available at: (accessed 13.01.2021).

12. Opening of China’s Financial Sector Has Hit a “Bottleneck”: Huang Qifan. hina Banking News, 09.12.2019. Available at: (accessed 03.09.2020).

13. Weinland D., Hammond G. Can Global Investment Banks Make It Big in China? Financial Times, 01.24.2020. Available at: (accessed 25.09.2020).

Registered in System SCIENCE INDEX

For citation:
Vdovin A. Foreign Banks in China: Start of a New Stage . World Eonomy and International Relations, 2021, vol. 65, no. 6, pp. 71-78.

Comments (0)

No comments

Add comment






Dear authors! Please note that in the VAK List of peer-reviewed scientific journals, in which the main scientific results of dissertations for the degree of candidate and doctor of sciences should be published for the “MEMO Journal” the following specialties are recorded:
economic sciences:
5.2.5. World Economy.
5.2.1. Economic Theory
5.2.3. Regional and Branch Economics
political sciences:
5.5.4. International Relations
5.5.1. History and Theory of Politics
5.5.2. Political Institutions, Processes, Technologies


Current Issue
2024, vol. 68, No. 4
Topical Themes of the Issue:
  • Financial Contagion Propagation in Europe under the Impact of Global Shocks
  • Regional Powers on the African Continent: Trends and Prospects
  • Investment Activity of the PRC in the Kyrgyz Republic
  • “Land Grabbing” Concept: Global and National Aspects
Submit an Article
The Editorial Board invites authors to write analytical articles on the following topics:
  • changes in the processes of globalization in modern conditions
  • formation of the new world order
  • shifts in civilization at the stage of transition to a digital society

The editors are also interested in publishing synthesis articles / scientific reviews revealing the main trends in the development of certain regions of the world - Latin America, Africa, South Asia, etc.