Financial Regulation Studies

Author: Wei Xinjiang
Publisher:
Publish Date: 2005-02-01
Features: Based on the new development trends in financial regulation, this book comprehensively and systematically introduces the fundamental theories and methods of financial regulation, supervision of banks and deposit-taking financial institutions, securities regulation, insurance regulation, regulation of foreign financial institutions, regulation of large mixed financial institutions, and international financial regulatory cooperation. The book is structured following the logic of first covering fundamentals and then industries, and first domestically and then internationally, closely linking basic teaching with the development of financial regulation. It emphasizes the combination of theoretical and applied analysis, prioritizing practice and highlighting applicability. The book is rich in data and features novel cases, addressing the gap in China's financial regulation teaching materials. It can also serve as a learning and reference tool for financial regulators, particularly those in banking regulation.
On March 10, 2003, the Third Session of the First Session of the 10th National People's Congress approved the reform plan for the State Council's institutional structure, granting the establishment of the China Banking Regulatory Commission (CBRC). On December 27 of the same year, the 6th Session of the Standing Committee of the 10th National People's Congress passed the Banking Regulatory Law of the People's Republic of China (hereinafter referred to as the Banking Regulatory Law), the Decision on Amending the People's Bank of China Law of the People's Republic of China, and the Decision on Amending the Commercial Bank Law of the People's Republic of China, which took effect on February 1, 2004. These three banking laws, along with the Securities Law, Insurance Law, Trust Law, Fundamental Law of Investment Funds, Negotiable Instruments Law, and relevant financial administrative regulations, departmental rules, local regulations, industry self-regulatory norms, and related international practices on financial regulation collectively form China's current financial regulatory system. The promulgation and implementation of the three banking laws mark the establishment of the basic framework of modern financial regulation in China.
According to the revised People's Bank of China Law, the primary responsibilities of the People's Bank of China (PBOC) are: "Under the leadership of the State Council, to formulate and implement monetary policy, prevent and resolve financial risks, and maintain financial stability." The revised People's Bank of China Law strengthens the PBOC's role in executing monetary policy and macroeconomic regulation, transferring the regulatory functions over banking financial institutions to the newly established CBRC. It retains certain financial supervisory functions related to the execution of central banking duties, continuing to oversee the circulation of the RMB, foreign exchange management, interbank lending markets, interbank bond markets, interbank foreign exchange markets, and gold markets. As a result, China's financial regulation will be carried out by four separate institutions: the PBOC, the CBRC, the China Securities Regulatory Commission (CSC), and the China Insurance Regulatory Commission (CIRC).
To ensure coordination among the four departments in regulatory matters, the People's Bank of China Law Article 9 authorizes the State Council to establish a financial supervision coordination mechanism. The Banking Regulatory Law Article 6 and the revised People's Bank of China Law Article 35 stipulate that the State Council's banking regulatory institutions and the PBOC should establish mechanisms for sharing supervisory information with other financial regulatory institutions.
Financial Regulation Studies emerged as a new course in this context. The revised People's Bank of China Law of 1995, Article 2, grants the PBOC the authority "to supervise and regulate the financial industry," and accordingly, relevant content on financial regulation is primarily introduced in Central Banking Studies, while also covered in related courses such as Financial Markets, Securities Investment, and Insurance. Since the 1950s, institutional economics, industrial economics, and information economics have proposed many novel and innovative theories on the nature, effectiveness, efficiency, and models of regulation. Meanwhile, financial regulation has been a key focus of research in China's financial theory and practice in recent years, yielding a series of research outcomes.
As a new course, Financial Regulation Studies should first summarize research findings on general theories of financial regulation both domestically and internationally, then examine regulatory issues for various financial institutions and activities, including commercial banks, securities, insurance, foreign financial institutions, policy-based financial institutions, financial groups, foreign financial institutions, and international investment and financing. The content arrangement of this textbook reflects this approach.
The writing of this book was completed through the collaboration of universities, regulatory authorities, and practical departments. Most of the authors involved hold doctorates in finance or financial law and are associate professors or higher, with many having study or work experience abroad. Several authors are already renowned figures in the industry. I sincerely appreciate their active participation! I would also like to specially thank Professor Zhou Zhongfei, Vice President of Shanghai University of Finance and Economics (Ph.D. supervisor, Ph.D. in Financial Law from the University of London, UK), Dr. Huang Jinlao from the China Bank International Financial Research Institute, and Professor Li Jun from the School of Business, Beijing University of Science and Technology (Ph.D. in Financial Studies from the Complutense University of Madrid, Spain, former General Manager of the Research Department of China Technology Securities Company) for their valuable suggestions on the textbook outline and their great support and encouragement to me personally.
The authors and their respective chapters are as follows: He Lifen (Beijing University of International Business and Economics, Chapter), Wei Xinjiang (Chapter 2), Yang Chaoqi (Chapters 3 and 4), Zhang Yuying (Chapter 7), Huang Yinghong (Chapters 8 and 9), Wang Hongzhong (Shanghai Aiguo Co., Ltd., Chapter 5), Yang Zhenghong (China Securities Regulatory Commission, Chapter 6), Li Jun (Beijing University of Science and Technology, Chapter 10), Zhou Zhongfei (Shanghai University of Finance and Economics, Chapter 11), Zhang Hua (Diplomatic Academy of China, Chapters 12 and 15), Huang Jinlao (China Bank International Financial Research Institute) and Gui Hefa (Jiangxi University of Finance and Economics, Chapter 13), Wu Xuelin (China Development Bank, Chapter 14). The final editing and compilation were completed by the author.
This book is suitable for undergraduate students of finance, master's students in finance, as well as vocational and technical college students. The applicable professional scope includes: finance, international finance, monetary economics, insurance, securities, futures, rural finance, and related fields.