Chinese financial institutions can cope with foreign competition: central bank

BEIJING (Reuters) - Chinese financial institutions are completely capable of coping with foreign competition as the $40 trillion financial sector is freed up, the central bank said on Thursday, after China and the United States signed a initial deal on trade.

The bank will strengthen financial supervision and prevent risks in the process of the sector’s opening, the People’s Bank of China added in a statement.

Under the initial deal, China has promised improved access to its banking, insurance, asset management, payment and fund management services, and agreed to expedite by nine months a previous December 2020 deadline for removing foreign ownership caps on securities firms.

Chinese financial regulators will build up “various firewalls” to improve its supervision in corporate governance and market construction amid the financial opening up, and maintain a stable financial system, the central bank said.

Based on the deal, the United States will also consider the application from Citic Group, China Reinsurance Group 1508.HK and China International Capital Corp (CICC) 3908.HK for the licensing of operations, the central bank said.

Reporting by Cheng Leng and Ryan Woo; Editing by Clarence Fernandez and Muralikumar Anantharaman