The Industrial and Commercial Bank of China's (ICBC) simultaneous listings on the Hong Kong and Shanghai stock exchanges in mid-October marked a new stage in the reform of the country's four State-owned banks.

Before the ICBC, two of the "big four" State-owned commercial banks, China Construction Bank (CCB) and Bank of China (BOC), had already gone public. The fourth, Agricultural Bank of China, will by now have gained adequate insight from the experiences of its peers if it goes public in the future.

After their initial public offerings (IPOs), the State-owned banks will see remarkable changes in their functions, their business models and even their roles in the country's economic development.

Before the State-owned banks can get on with their new roles, they will face a series of problems, such as the salaries of high-ranking managers after they go public, their roles in the government's macroeconomic re-adjustment, and the problem of overheated investment driven by the loans boom.

So what exactly is the function and role of these State-owned banks after they go public?
Before the four State-owned banks began their reforms to qualify for an IPO in 2003, their role was to pool financial resources across society and allocate them to industries, sectors or enterprises.

In both actions, they had to abide by government guidelines and fulfil their roles in helping to re-adjust the economy.

At the end of 2003, the State-owned banks began a financial restructure according to internationally accepted financial standards.

To prepare for a market-oriented commercialization, to qualify for an IPO and attract potential strategic investors, the State-owned banks reined in credit, cut down non-performing loans and increased capital.

But they are still the major power in the country's economy and sit at the core of the economic cycle.

The real estate industry has driven the latest round of economic growth. Investment in the sector and individual house purchases have increased dramatically in a short period.

The State-owned banks are behind this growth because of their huge market share in individual house mortgages and long-term ties with property developers.

The business operations of the State-owned banks have a direct influence on the ups and downs of the country's banking credit as a whole.

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