Research On The Governance Structure In Joint-stock Reform Of SOCBs

The separation of Politic Bank and Commercial Bank was the prelude to the Reform of State-Owned Commercial Banks in 1994. And then, the Ministry of Finance issued 270 billion RMB yuan special treasury bonds to replenish the capital funds of four State-Owned Commercial Banks (SOCBs) in 1998; The Big Four transferred a combined 1.4 trillion yuan of non-performing loans to the newly formed four asset management companies in 1999; The government injected 45 billion US dollars of its foreign exchange reserves into the Bank of China and the China Construction Bank again to raise their capital adequacy ratios to meet the listing requirements in late 2003, expecting a fundamental reform of State-Owned Commercial Banks'system. The listing of China Construction Bank in 2005 and Bank of China in 2006 indicates that the Joint-stock Reform of SOCBs has come into the real implementation stage.However, the listing of State-Owned Commercial Banks cannot cover up the essential problems of their Governance Structure. Since 1994, bribery, corruption and illegal operations have happened much more frequently. The Nanhai Huaguang's 7.4 billion yuan fraudulent loan case, the Shanxi 7.28 financial fraud case which involves as much as hundreds of millions yuan and the case of Peng Weizhi, finance director of Agricultural Bank of China, Shenzhen Branch, who embezzled 40 million public fund……the above are just several examples of all the shocking cases happened during the last more than ten years. Shen Xiaoming, an official of China Banking Regulatory Commission(CBRC), revealed that according to statistics, the four State-Owned Commercial Banks exposed more than 240 cases in the first half of 2006, three quarters of which happened in the previous years. It means that there were still over 60 new cases. Therefore, we are safe to say that there is...