China's banking system has gone through some profound changes, though reform is far from complete. Financial liberalisation has yet to fully unleash the banking potential for the asset demand, note the infancy of China's mortgage and personal finance market.
It will take a few more years than many have expected for banking reform to be completed, despite the WTO requirements for China to fully open its banking sector to competition by the end of 2006. The banking system is unlikely to collapse, however, despite the slow pace of reform and the inherent banking woes. But Beijing must take bold steps to push reform forward.
These include making...
