Banks

China’s Central Bank
is the People’s Bank of China, founded in 1948, operating as a central bank since 1983, and formally designated as such in 1995. The PBoC oversees China’s foreign exchange and gold reserves and is modelled after the US Federal Reserve. It also regulates inter-bank lending and the inter-bank bond markets; formulates and manages monetary policy; and sets interest rates. UK-PBOC relations are generally good. The PBoC has over 600 employees and a representative office in London.

4 State-Owned Commercial Banks
under the PBoC are:

Bank of China (7th in the world)
Industrial and Commercial Bank of China (9th in the world)
China Construction Bank (14th in the world)
Agricultural Bank of China (65th in the world)

All except the Agricultural Bank have restructured, listed and taken foreign strategic partners. The Agricultural Bank of China is in the process of restructuring, although it seems likely that domestic strategic investors may sought (e.g. Huijin). All four have branches in London, except CCB which is actively looking at upgrading its London representative office.

3 Policy Banks
established in 1994 to take over the government-directed spending functions of the 4 state-owned commercial banks are:

China Development Bank - infrastructure financing
Export-Import Bank of China (Chexim) - trade financing
Agricultural Development Bank of China (ADBC) - agricultural development

These policy banks are expected to be restructured along commercial lines. CDB took a strategic investment in Barclays in 2007 and Barclays has been advising and training CDB staff as the bank moves towards commercialisation.

Foreign Banks
More than 200 foreign banks have begun operating in China since China’s accession into World Trade Organisation in December 2001.

Regulations
Large banks are required to keep 17% of their deposits on reserve at the Central Bank (16% for smaller banks). Commercial and investment banking are currently strictly separated so banks are not allowed to conduct securities business. There are a few emerging financial holding companies like CITIC, China Ping An and China Everbright, but licences for banking and securities are given to separate and independent operating units within the group.