China said to weigh moving finance reform meeting up a year

[BEIJING] Chinese authorities are considering convening a top-level finance work conference this summer, a year ahead of schedule, to map out a sweeping consolidation of the country's financial regulatory system in a move to reduce risks.

The national financial work conference - held every five years and slated next for 2017 - may be moved to this year, according to people familiar with the matter. One person said the leadership feels an urgency to overhaul financial oversight following last year's market turmoil and aims to curb financial risks at a critical time for President Xi Jinping's economic reforms.

A series of financial scandals and the aborted introduction of a stock market circuit breaker has added pressure on regulators who were criticized by Premier Li Keqiang for their handling of volatile markets. Financial sector risks pose increasing challenges as the leadership tries to stabilize the economy, which is growing at the slowest pace in a quarter century.

"A thorough reform of the regulatory system to bring it closer to global best practice will enable the central bank to leverage its strong position on information collection and reduce future bail-out costs," said Shen Jianguang, chief Asia economist at Mizuho Securities Asia Ltd in Hong Kong.

The People's Bank of China is seeking a bigger regulatory role, Bloomberg reported last month. Changes under consideration would grant the central bank greater powers over financial services companies in an enhanced macro-prudential role.

The State Council Information Office, the central government's main press office, didn't respond to a faxed request for comment on the plan to bring forward the work conference.

Previous meetings led to the establishment of agencies on securities, insurance and banking, the three major financial regulators, to reinforce risk management. Other initiatives involved the overhaul of state-owned lenders and the central bank's local branches to reduce administrative interference over the execution of monetary policy at the local level.

The national financial work conference comprises key policy makers including the premier, top financial officials and heads of state-owned banks who convene for two or three days to draw up plans on financial reform over the following five years.

BLOOMBERG