China's Banking Reform - The Good, the Bad and the Ugly

Despite their establishment last year to speed up bank restructuring, China’s asset management companies (AMCs) cannot function properly due to the presence an inadequate legal framework and questionable incentives. The ugly truth is that banking reform will take much longer than the official rhetoric has it. This protracted process will delay currency convertibility and - insofar as foreign banks are concerned - the complete liberalization of the Chinese banking market.