China's State Council has given the
nod to a new Chinese bank to be known as the National
Postal Savings Bank, which will be based on the existing savings deposit
business at far-flung postal stations, a senior
banking official revealed Wednesday.
Vice-Chairman Cai Esheng of the China Banking Regulatory Commission
told a finance forum in Beijing the new bank will provide "basic services"
to millions of rural dwellers.
Postal savings services were kicked
off in 1986 with the establishment of the China Post
Savings and Remittance Bureau (CPSRB). By the end of 2005, CPSRB had a
deposit balance of 1.3 trillion yuan (about 162 billion U.S. dollars),
making it the fifth largest savings institution just after the "Big Four"
CPSRB takes deposits from
the public, which, however, can only flow to the central bank. Interest
rate income from the deposits has been CPSRB's major source of profit amid
the dwindling use of its traditional postal services.
An earlier government plan said the national postal system will be
split into three parts: a post regulatory body, a postal service company
and a postal savings bank.
According to Cai, the new bank will largely focus on retail and
intermediarybusiness, "forming sound,
complementary relations with other commercial banks" to contribute to the
development of the "new socialist countryside," a concept the Chinese
government has raised amid efforts to boost rural development.
China had more than 28,000 financial institutions in the banking sector
with total assets of nearly 40 trillion yuan by the end of April, figures
Cai said China's banking reforms are on a sound track, with supervision
of the sector greatly enhanced, adding, however, it will take a long time
for reforms to be