By Sun Fei, Research Team on “The Transformation and Development of China’s Commercial Banks during the 13th Five-Year Plan Period”, Research Institute of Finance, DRC

Research Report No. 114, 2017 (Total. 5189) 2017-9-11

Abstract: In the mid-to-later period of the 1970s, the Japanese government pushed forward the reform of capital account liberalization and the market-based interest rate reform in order to cope with the sluggish economic performance and the rising pressure on the yen appreciation. Under this background, the Japanese banking sector launched three transformations respectively in the 1980s during the mid-to-low growth period, after the outburst of economic bubbles in the 1990s, and during the Abe-administration period, which made some achievements in terms of internationalized development and business structure upgrading, whereas some problems and hidden risks also loomed up. Although the banking sector’s structure and development stages of Japan are different from that of China, China's banking sector is facing similar issues with that of Japan relating to market-based financial reform and the RMB internationalization trend and Japan’s experience makes good reference to China. Based on China's actual development, the government needs to strengthen macro guidance and implement policy measures in a progressive and proper manner; the commercial banks need to pursue market-oriented reforms, strengthen risk awareness, and take positive moves to push ahead with transformation in light of China’s conditions.

Key words: banking sector, transformation, experience, Japan