The State aims to improve the efficiency of these banks by putting them in a more competitive environment.

The banks will have an expanded business scope and operate more independently, but will be required to shoulder market risks, according to media reports.

Traditionally, they have had the financial backing of the State even if they incur losses.

The China Development Bank, which registered a non-performing loan ratio of 0.72 by the end of 2006, may be the first to be reformed into a commercial bank.

Caijing Magazine said it will establish a modern corporate governance structure.

Rural financial reform discussions are expected to produce more results at the current meeting, the media reported.

Reform plans for the Agricultural Bank of China, the last of the Big Four State commercial banks to be reformed, are expected to be mapped out at the meeting.

Reforms may include the write-off of bad loans, establishment of a share holding structure, strategic investments and listing.

The meeting reportedly may also push for the establishment of a multi-tier rural financial structure, in which community financial institutions can be more accessible to farmers.

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