PBOC urges reform in state-owned commercial banks

China's central bank, the People's Bank of China (PBOC), announced that state-owned commercial banks will conduct further reforms to enhance their competitiveness.

According to a document posted on its website, the stock incentive program, which the commercial banks are urged to launch by the central bank, is part of PBOC's efforts to deepen the reform on human resources management.

This program includes staff shareholding and senior supervisors' stock option systems, and aims at increasing employees' sense of belonging to the company and thus making greater contributions to their companies.

Reviewing reform and reshuffle experiences, the central bank disclosed that it was important to introduce qualified overseas strategic investors, which helped in forming modern commercial bank management structure and operating mechanisms. In terms of the cooperation with foreign investors, the commercial banks should focus on bringing in advanced management experience, expertise and the appropriate financial products. They should also strengthen technical cooperation in areas such as corporate governance, product research and financial innovation to improve their credit analysis and risk management capabilities, said the central bank.

However, the state-owned commercial banks should pay more attention on national interests and financial security when seeking cooperation with overseas financial institutions.