China’s banking regulator is organizing a nationwide training program for 500 senior officials from the mainland’s «big four», policy and rural lenders to help contain bad loans.
The China Banking and Insurance Regulatory Commission (CBIRC) will train senior bankers on how to detect and asses risk alongside the application of digital technology to improve efficiency.
«The training aims to bring risk management in the financial industry to fruition,» said Zhao Changyi, a risk management expert who has been tasked to head the CBIRC-sponsored initiative, according to an «SCMP» report.
«Financial stability will lay a solid foundation for a healthy economic order.»
3-Day Program
The three-day training program will provide senior bankers with access to resources such as lectures by CBIRC officials and risk veterans such as Liu Ruixia, chief risk expert with the China Banking Association.
On digitalization, Zhao noted that senior bankers were advised to create effective data frameworks for data management.
«Creation of a strong data monitoring system within a bank paves a way for improved capabilities in risk management,» he said. «Strengthened risk management eventually ensure sustainable growth.»
Bad Loans and Shadow Banking
China’s banking sector suffered its first profits drop since the global crisis over a decade ago (24 percent last quarter) while bad loans rose for the sixth consecutive quarter to reach 2.7 trillion yuan ($395 billion).
Bad debt aside, there are also rising concerns about the reemergence of shadow banking or peer-to-peer lending as the crippling economy pressures businesses to seek liquidity even at higher costs. Just last month, Chinese regulators laid claim to the successful unwinding of peer-to-peer lending by shutting down more than 99 percent of players in the market.
