People's Bank of China

The bank was established on December 1, 1948, based on the consolidation of the Huabei Bank, the Beihai Bank and Northwestern Farmers' Bank.[5]^: 37 The headquarters was first located in Shijiazhuang, Hebei, and then moved to Beijing in 1949. Between 1950 and 1978 the PBC was the only bank in the People's Republic of China and was responsible for both central banking and commercial banking operations.[6]^: 225 All other banks within Mainland China such as the Bank of China were either organized as divisions of the PBC[7] or were non-deposit taking agencies.[8][9]

From 1952 to 1955 government shares were added to private banks to make state-private banks, until under the first Five Year plan from 1955 to 1959 the PBC had complete control of the private banks, making them branches of the PBC, closely resembling the vision of Vladimir Lenin. With aid from the Soviet Union, the shares of private enterprises and with them industrial output followed a similar path, forming a Soviet-style planned economy.

During the Cultural Revolution, the PBC suspended its commercial banking service.[5]^: 38 In 1969, the State Council approved the consolidation of PBC's headquarters as a bureau within the Ministry of Finance.[5]^: 38 Local PBC branches were merged into local government finance departments.[5]^: 38 This effective demotion of the PBC lasted for a decade until August 1979, when the PBC was separated from the Ministry.[5]^: 42

With the exception of special allocations for rural development, the monolithic PBC dominated all business transactions and credit until 1978,[10] when, as part of the Chinese economic reforms, the State Council split off the commercial banking functions of the PBC into four independent but state-owned banks, including the Industrial and Commercial Bank of China (ICBC), the Bank of China (BOC), the Agricultural Bank of China (ABC), and the China Construction Bank (CCB).[11] In September 1983, the State Council promulgated that the PBC would function exclusively as the central bank of China and no longer undertake commercial banking activities.[5]^: 42

Chen Yuan was instrumental in modernizing the bank in the early 1990s. Its central bank status was legally confirmed on March 18, 1995, by the 3rd Plenum of the 8th National People's Congress, and was granted a higher degree of independence than other State Council ministries by an act that year.[12]

In 1996 and 1996, the PBC established fundamental regulations on loans and consumer credit.[13]^: 20

In 1998, the PBC underwent a major restructuring. All provincial and local branches were abolished, and the PBC opened nine regional branches, whose boundaries did not correspond to local administrative boundaries.[14]

In 2003, the Standing Committee of the National People's Congress approved an amendment law for strengthening the role of PBC in the making and implementation of monetary policy for safeguarding the overall financial stability and provision of financial services.

In 2006, the PBC established the Credit Reference Centre to provide financial credit reporting.[13]^: 47

During the Great Recession, the PBC helped address bank liquidity crisis by signing swap agreements with numerous other countries to provide them with liquidity based on the renminbi.[15]^: 267 As of 2021, China has swap agreements with 40 countries.[15]^: 271 The PBC underwent through another major restructuring in 2023, with the abolishment of the regional arms and reopening of the previous provincial and local branches.[14] Additionally, its county-level branches were absorbed by city-level branches.[16] The oversight over financial holding companies and financial consumer protection was also transferred from the PBC to the newly established National Administration of Financial Regulation.[16] The new branches were inaugurated on 18 August 2023.[17]

The PBC is a cabinet-level executive department of the State Council.[12] The top management of the PBC are composed of the governor and a certain number of deputy governors. The governor is nominated by the premier of the State Council, who is then approved by the National People's Congress or its Standing Committee and appointed by the president.The deputy governors of the PBC are appointed to or removed from office by the premier.[18]

The PBC adopts the governor responsibility system under which the governor supervises the overall work of the PBC while the deputy governors provide assistance to the governor to fulfill his or her responsibility. The current governor is Pan Gongsheng. Deputy governors of the management team include: Wang Huaqing, Fan Yifei, Guo Qingping, Zhang Xiaohui, and Yang Ziqiang.[19] Former top-level managers include: Hu Xiaolian, Liu Shiyu, Li Dongrong and Jin Qi.

While operating with some degree of autonomy, the PBC does not have central bank independence and is politically required to implement the policies of the Chinese Communist Party (CCP).[20] The CCP committee secretary of the PBC is the most powerful position in the bank and can hold more sway than the governor. The current CCP committee secretary is Pan Gongsheng.[21]

People's Bank of China Tianjin branch, formerly the Central Bank Tientsin Branch building until 1949, now a protected heritage site

The PBC has branches in each 31 provincial-level administrative divisions in China, branches in five cities (Shenzhen, Dalian, Ningbo, Qingdao, and Xiamen), and 317 branches in prefecture-level divisions.[17] It has 6 overseas representative offices (PBC Representative Office for America, PBC Representative Office (London) for Europe, PBC Tokyo Representative Office, PBC Frankfurt Representative Office, PBC Representative Office for Africa, Liaison Office of the PBC in the Caribbean Development Bank).

The PBC Monetary Policy Committee is an advisory body chaired by the PBC governor. It typically includes the directors and deputy directors of other financial agencies, as well as a few influential academic economists.[22]

Previously, interest rates set by the bank were always divisible by nine, instead of by 25 as in the rest of the world.[26][27] However, since the central bank began to increase rates by 0.25 percentage points on October 19, 2010, this is no longer the case.

PBC latest interest rate changes:[28]

China's Reserve Requirement Ratio for large banks

PBC latest reserve requirement ratio (RRR) changes:

Foreign-exchange reserves from 2004:[35][36]

• China Banknote Printing and Minting Corporation
• Renminbi, the Chinese national currency
• Internationalization of the renminbi
• Bank of China, state-owned commercial bank
• Hong Kong Monetary Authority
• Monetary Authority of Macao
• Central Bank of Taiwan
• List of largest banks
• List of microfinance banks

• Stephen Bell and Hui Feng. The Rise of the People's Bank of China: The Politics of Institutional Change (Harvard University Press; 2013) 384 pages; Recent history; uses interviews with key figures

Wikimedia Commons has media related to People's Bank of China.

• Official website