| Finance is the core of a modem economy. The establishment of a healthy, complete, efficient financial system is key to the safety of the financial system, and it is also a critical issue in the healthy, stable, rapid and sustainable development of the national economy. A financial system refers to the various parties in it, such as the suppliers and buyers of funds, financial intermediaries, regulation authorities, as well as the cooperation and relationship among these parties, which creates the financing mechanism of the economy. The most important and active participants in the entire financial system are those financial institutions, such as commercial banks, securities firms, investment banks and insurance companies, who are involved in direct or indirect financing activities.It is important to adopt an appropriate method to deal with the relationship among different industries in he financial system. Practice in major countries show that the mainly handle this issue with two system: the mixed Financial System of U.S. and U.K. were previously typical of the separation of different industries, while German is a representative of the mixed financial system. China's financial system is a separate one atpresent. Nevertheless, financial innovations, deregulation and globalization has made it a trend to transfer from a separate financial system, which prohibits commercial banks from conduction securities business, into a mixed financial system, which allows a financial institution to offer a wide range of financial products. In this context ,it is of great importance, both theoretically and practicalyy, to investigate the necessity the necessity for China to adhere to a strict separate financial system and to explore alternatives to this system if it is to be reformed. Under these premises, this article discusses the choice of appropriate financial systems in the transfer of China's economy, which is hoped to contribute to the construction of China's financial industry.This article performs analysis of the history and value of financial system, as well as a comparison of different system. It is concluded that a separate financial system pays more attention ot safety, while a mixed one is focused on efficiency. A good financial system, however, should take both safety and efficiency into consideration. Meanwhile, this article carries out research of the evolution of the financial systems of major countries in the world and reaches the conclusion that a mixed financial systems is more appropriate in the context of theintegration and globalization of economy and finance. It is also pointed out that the transfer from a separate financial system into a mixed one in western countries is completed under the guidance of appropriate legal framework. The experience of western economies, therefore, cold provide China with their examples and lessons.This article performs a rational analysis of the current financial system of China, points out the deficiencies of this system and concludes that China's adoption of the separate financial system is an irrational choice. In view of the conditions of China's financial system and legal framework, it is suggested that China, in the context of the current transfer of its economy, should choose a financial system that, on the one hand, allows the mixing of different industries, and on the other hand, insists separate regulation of different industries in the system. Furthermore, this article proposes a legal framework that suits the adoption of a mixed financial system, with initial plans for the main laws in this framework.This article consists of three parts:Part one sets out the definition, category and characteristics of financial systems, and makes a grief review of the common rules and processes of the evolution from the separate financialsystem to the mixed financial system in major countries in the world.Part two discusses the history and background of China separate financial industry, points out the serious problems brought about by this sy... |
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