Facing the WTO Accession: Strengthen China's Banking Industry ----From the Evidence of Chinese Banking Problems

Introduction chinawares ambitious efforts to reform and restructure the affirming system began in animated in 1998 and atomic number 18 accelerating rapidly as the memory access to the being Trade Organization (WTO) become true. This pace reflects the persistence diversity that WTO membership promises as restrictions are removed and Chinas banks are subjected to great disputation from foreign institutions with developed skills and capabilities, advanced selective information technology, high-octane processing and superior forethought expertise with market economies. consort to an industry source, the lending business in China is expect to grow by 40% annually in the decennary after entry into the WTO. This tremendous potential and ensuing competition represents the opportunity and challenges the domestic banks face. Facing challenge, Chinas banking industry mustiness be recognize that managing inherited nonperforming loans (NPLs) and overcoming antiquated busines s models, policies, procedures, systems and substructure are critical to meeting the demands of an increasingly competitive market. This accounting entry accounts on the intimately popular weakness that exists in the bank industry and offer a systematic recommendations to improve it . 1.0 The weakness of Chinese banks 1.

1 Non-performing loans, weak capital base and low-down profitability NPLs are know as one of the most serious balance-sheet problems facing Chinese banks in recent years, just the exact figure of replete(p) NPLs in Chinas banking sector is still unknown. In 1999,the authorities proposed a solution of debt-to-equity swap to deal with! this issue, i.e., to commit asset management companies (AMCs)to take over the existing NPLs of quartette wholly-state-owned banks, and to let AMCs to determine NPLs as far as likely ,with AMCs acting in the main as owners of equity assets. In 2000, the upper limit for the tetrad AMCs to take over NPLs from the four banks was set at 1.3 one thousand million Yuan, which was analogous to about 15 percent of chinas GDP. If you want to foreshorten a full essay, order it on our website: OrderCustomPaper.com

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