Financial Stability and Development Committee

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The Financial Stability and Development Committee (金融稳定发展委员会) is a financial regulatory body under the auspices of China’s State Council that was established in 2017, for the purpose of strengthening coordination between financial regulators and supplementing regulatory shortcomings.

History 

Chinese President Xi Jinping flagged the establishment of the Financial Stability and Development Commission during the keynote speech delivered at the National Financial Work Conference held during 14 – 15 July 2017 in Beijing.

In November the Central Committee of the Chinese Communist Party and the State Council approved the establishment of the Financial Stability and Development Committee under the auspices of the State Council.

During the same month the first full meeting of the Financial Stability and Development Committee was convened for the goal of “studying the spirit of the 19th National CCP Congress, and research and arranging related work.”

Personnel

The inaugural and current chairman of the Financial Stability and Development Committee is Ma Kai (马凯).

Main purpose

According to the keynote speech delivered by President Xi Jinping at the National Financial Work Conference in July 2017, the primary purpose of the Financial Stability and Development Commission is to “strengthen financial regulatory coordination and supplement regulatory shortcomings,” as well as “strengthen the People’s Bank of China’s macro-prudential regulation and systemic risk prevention role, strengthen the regulatory role of financial regulatory departments, and ensure the safe and stable development of the Chinese financial sector.”

Main functions

In the keynote speech delivered at the National Financial Work Conference in July 2017, Xi Jinping outlined the following principles for future regulatory undertakings:

1.Return to the source, abide by [the notion of] servicing economic and social development. Finance must make servicing the real economy its starting point and toehold, and comprehensively raise the level and efficiency of service, allocate even more financial resources to key areas and weak links for economic and social development, and better satisfy the diversified financial needs of the masses and the real economy.

2. Structural optimisation, improvements to financial markets, financial institutions, and the financial product system. Firmly uphold quality as the chief priority, guide the financial sector’s development in coordination with economic and social development, expedite the convenience of financing, reduce costs for the real economy, raise resource allocation efficiency, and ensure that risk is controllable.

3. Strengthen regulation, raise the ability to prevent and resolve financial risk. Make strengthening of financial regulation the focal point, prevention of systemic financial risk the bottom line, accelerate the establishment of relevant laws and regulations, improve the legal person administrative structure of financial institutions, strengthen the macro-prudential regulatory system, strengthen regulation of functions, and focus more regulation of conduct.

4. Market guidance, utilising the decisive role of the market during allocation of financial resources. Firmly uphold the reform direction of the socialist market economy, properly handle relations between government and the market, improve market restraint mechanisms, and raise the efficiency of financial resource allocation. Strengthen and improve government macro-controls, improve market regulations, strengthen discipline.

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