China is considering a proposal to create a ministerial-level body to manage its state-owned banks and non-bank financial enterprises, two sources with knowledge of the plan said, a move that would strengthen Beijing's grip on its lenders.
The new body would have a say in the management of China's biggest state-controlled financial institutions, including banks, brokerages, insurers, trust firms and funds, said the sources, one of whom has ties to China's top leaders and another who is a senior executive in China's financial industry.
By creating an overseer for banks, Beijing could distribute the burden of managing its numerous and sometimes unruly state-owned businesses. The focus on banks may also tighten China's hold on its fast-growing financial sector.
The new financial supervisor would also outrank top bank executives in China's political hierarchy, said the sources, an important consideration in a country where top managers of state-controlled firms are usually high-ranking Communist Party members.
The heads of China's financial regulators, including the China Banking Regulatory Commission and the central bank, often have the same or slightly lower Party rank as the heads of the top state-owned firms.
The sources have requested anonymity because they were not authorized to speak to reporters.
SASAC, the banking, securities and insurance regulators declined to comment when contacted by telephone.
(Reporting by Benjamin Kang Lim and Koh Gui Qing; Editing by Don Durfee)