How to set up a private bank? (Recommended dry stuff)

How to set up a private bank? (Recommended dry goods) 12 companies will be approved in one year in 2025，Private banks welcome a blowout year! How to set up a private bank? This article analyzes in detail the basic procedures and legal issues for establishing private banks.，Start with national policies and regulations，and extend to specific practical issues，Helps to have a more complete understanding of the establishment and legal issues of private banks。

Analysis of legal issues in the establishment of private banks Our practical and theoretical research on the establishment of private banks based on participation，Write this article to explore the legal issues of establishing a private bank，Start with national policies and regulations，and extend to specific practical issues，In order to attract new ideas，Arouse broader and in-depth discussions from all walks of life。

Overview of the legal and regulatory system for the establishment of private banks. In terms of the laws and regulations applicable to the establishment of private banks，We can discuss this from two levels: macro policy documents and micro operational basis.。1.Macro level policy documents Macro level policy documents，Mainly refers to the regulations that provide policy support and direction guidance for the establishment of private banks.。

Although these documents do not contain detailed rules or operational guidelines for the establishment of private banks,，But they are the "wind vane" of policy，Reflects the views and attitudes of regulatory agencies。

According to the order of release time，We summarize the policy documents on the establishment of private banks at the macro level as follows:：(1)"Several Opinions of the State Council on Encouraging and Guiding the Healthy Development of Private Investment" May 7, 2010，The State Council issued "Several Opinions of the State Council on Encouraging and Guiding the Healthy Development of Private Investment"。

Although as early as 2003，Regulators start piloting private banks，and proposed five pilot banks，However, private banks have never developed on a large scale since then.。

"Several Opinions of the State Council on Encouraging and Guiding the Healthy Development of Private Investment" encourages private capital to enter infrastructure、social undertakings、Municipal public use、financial services、trade circulation、Six major fields including national defense science and technology，Although financial services is only one of six areas，However, because the document for the first time set the tone of “allowing private capital to establish financial institutions”，Interpreted by the outside world as a signal that access to private banking institutions will be reopened.。

(2)The "Implementation Opinions of the China Banking Regulatory Commission on Encouraging and Guiding Private Capital to Enter the Banking Industry" is a response to the relevant content of the "Several Opinions of the State Council on Encouraging and Guiding the Healthy Development of Private Investment"，The China Banking Regulatory Commission issued the "Implementation Opinions of the China Banking Regulatory Commission on Encouraging and Guiding Private Capital to Enter the Banking Industry" on May 26, 2012.，Point out that private enterprises can be established by sponsoring、Subscribe for new shares、Transferred equity、Invest in banking financial institutions through mergers, acquisitions, restructuring and other methods，It is clarified that the market access conditions for private capital to enter the banking industry should be the same as those for other types of capital.。

(3)"Guiding Opinions of the General Office of the State Council on Financial Support for Economic Structural Adjustment, Transformation and Upgrading" July 1, 2013，The General Office of the State Council issued the "Guiding Opinions of the General Office of the State Council on Financial Support for Economic Structural Adjustment, Transformation and Upgrading"，It is proposed to "try to establish private banks initiated by private capital and bear their own risks"。

Considering that the risk spillover from bank failure will seriously affect social stability，The "Guiding Opinions of the General Office of the State Council on Financial Support for Economic Structural Adjustment, Transformation and Upgrading" formally proposed for the first time that private banks should bear their own risks.

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。also，It is worth mentioning that the document also specifies the specific departments responsible for the relevant work content.，That is, led by the China Banking Regulatory Commission，People's Bank of China、State Administration for Industry and Commerce、The Legislative Affairs Office of the State Council and others participated。

(4)"Implementation Opinions of the General Office of the State Council on Financial Support for the Development of Small and Micro Enterprises" August 8, 2013，The General Office of the State Council issued the "Implementation Opinions of the General Office of the State Council on Financial Support for the Development of Small and Micro Enterprises"，It is again proposed to promote the establishment of private banks initiated by private capital and bear their own risks.，At the same time, it was further pointed out that the market positioning of private banks is to serve regional small and micro enterprises.，and designated the China Banking Regulatory Commission to take the lead in this work。

(5)"China Banking Regulatory Commission on China(Shenzhen)Notice on Issues Related to Banking Supervision in the Pilot Free Trade Zone, September 27, 2013，The State Council issued the "China(Shenzhen)Overall plan for the free trade pilot zone，It mentioned that “qualified private capital and foreign financial institutions are allowed to jointly establish Sino-foreign joint venture banks.。when conditions are met，Pilot banks with limited licenses will be established in the pilot zone in due course."。

2013September 29，China (Shenzhen) Pilot Free Trade Zone was officially established。same day，As a response to "China(Shenzhen)Response to the Overall Plan for the Free Trade Pilot Zone，The China Banking Regulatory Commission issued the "China Banking Regulatory Commission's Notice on China(Shenzhen)Notice on Issues Related to Banking Supervision in the Pilot Free Trade Zone"，Support qualified private capital to establish self-risk private banks in the region。

(6)"Decision of the Central Committee of the Communist Party of China on Several Major Issues Concerning Comprehensively Deepening Reform" November 15, 2013，The "Decision of the Central Committee of the Communist Party of China on Several Major Issues Concerning Comprehensively Deepening Reform" reviewed and approved by the Third Plenary Session of the 18th CPC Central Committee was officially released，Article 12 of the decision proposes to expand the opening up of the financial industry both internally and externally.，Under the premise of strengthening supervision，Allow qualified private capital to initiate and establish small and medium-sized banks and other financial institutions in accordance with the law。

1. Although the operation basis at the micro level is guided by the aforementioned macro policy documents,，However, detailed rules on market access and establishment procedures for private banks at the micro level have not yet been implemented.，therefore，At present, the main operational basis for private enterprises to prepare to establish private banks is to refer to the relevant laws and regulations applicable to Chinese-funded commercial banks.。

Accordingly，According to the level of legal effectiveness，We summarize the micro-level regulatory documents as follows:：(1)"Company Law" under my country's current legal system，The organizational form of a commercial bank is a joint stock company，Private banks are no exception。therefore，The general provisions regarding joint stock companies in the Company Law apply to the establishment and operation of private banks.。

(2)According to the Commercial Bank Law, private banks are engaged in taking deposits from the public.、grant loans、Corporate legal persons that handle settlement and other business，therefore，Private banks should also comply with the relevant provisions of the Commercial Bank Law。(3)"Corporate Governance Guidelines for Commercial Banks" July 2013，The China Banking Regulatory Commission officially issued the "Guidelines on Corporate Governance of Commercial Banks"，2002The "Corporate Governance Guidelines for Joint-stock Commercial Banks" no longer apply。

Compared with the 2002 "Corporate Governance Guidelines for Joint-stock Commercial Banks"，"Corporate Governance Guidelines for Commercial Banks" on the Constraints on Shareholder Behavior、Further improvements have been made in terms of board operations and directors’ performance of duties.

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。therefore，Established in private bank、In the process of establishment，It is necessary to pay attention to establishing a corporate governance structure and formulating corresponding internal regulations in accordance with the "Corporate Governance Guidelines for Commercial Banks"。

(4)"Implementation Measures for Administrative Licensing Matters of Chinese-funded Commercial Banks" November 14, 2013，The China Banking Regulatory Commission officially issued the revised and improved "Implementation Measures for Administrative Licensing Matters of Chinese-funded Commercial Banks"。we think，2013The "Implementation Measures for Administrative Licensing Matters of Chinese-funded Commercial Banks" in 2017 is the most important operational basis for the establishment of private banks at present.，This measure stipulates the conditions for the establishment of banks、Sponsor (shareholder) qualifications、Important matters such as establishment procedures。

Compared with the "Implementation Measures for Administrative Licensing Matters of Chinese-funded Commercial Banks" issued in 2006，2013The "Implementation Measures for Administrative Licensing Matters of Chinese-funded Commercial Banks" reflects the direction of the China Banking Regulatory Commission to optimize and improve the administrative approval of Chinese-funded commercial banks.，Among them, some new ones are different from the 2006 "Implementation Measures for Administrative Licensing Matters of Chinese-funded Commercial Banks"

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worthy of particular attention。

(5)"Catalog and Format of Application Materials for Administrative Licensing Matters of Chinese-funded Commercial Banks"

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"As a supporting provision of the "Implementation Measures for Administrative Licensing Matters of Chinese-funded Commercial Banks"，"Catalog and Format of Application Materials for Administrative Licensing Matters of Chinese-funded Commercial Banks"

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》For those listed in the former

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and conditions to be refined，It also provides specific guidelines for the preparation of application materials for establishing private banks.。

It should be noted that，Currently in effect, the Catalog and Format of Application Materials for Administrative Licensing Matters of Chinese-funded Commercial Banks

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》is the supporting provisions of the 2006 "Implementation Measures for Administrative Licensing Matters of Chinese-funded Commercial Banks"，This document has not yet been updated accordingly in accordance with the relevant provisions revised in the 2013 "Implementation Measures for Administrative Licensing Matters of Chinese-funded Commercial Banks"。

The basic procedures for establishing private banks are in accordance with the provisions of the "Implementation Measures for Administrative Licensing Matters of Chinese-funded Commercial Banks"，The establishment of a Chinese-funded commercial bank requires two stages: preparation and opening.。we think，The establishment of private banks is no exception，should be divided into two stages: preparation and opening。

Based on our experience in participating in a large number of commercial bank formation projects，Combined with the current policy and legal environment for establishing private banks，We believe that the specific steps for the preparation and opening of private banks are as follows:：1.Preparatory stage(1)The main sponsor prepares the establishment plan，And select other qualified sponsors as the leaders of the entire private bank establishment project，The main sponsor is responsible for formulating the establishment plan。

The establishment plan should include the market positioning of the proposed bank、business model、Basic terms such as financial forecasting and corporate governance。The main sponsor will select other sponsors based on the establishment plan，Potential sponsors can also judge whether the project is in line with their own interests and long-term development plans by understanding the establishment plan.。(2)Sign a sponsor agreement，After establishing a preparatory working group and determining the sponsors,，The sponsors will sign a sponsor agreement and set up a preparatory working group。

The sponsor agreement is the "charteral document" for the sponsors in the preparation stage.，This should generally include arrangements for the promoter to pay capital、The basic provisions of corporate governance to be written into the articles of association and the corresponding responsibilities of the promoters when the bank cannot be established, etc.。The preparatory working group is authorized by all sponsors，The organization responsible for carrying out specific preparatory work，Usually consists of representatives sent by the sponsor，According to the specific needs of the project，May also include external professional consultants。

(3)Hire a professional agency to ensure the smooth progress of the project，The preparation of the working group requires the hiring of a law firm、Financial consultants and other professional organizations provide professional services for matters related to preparation and opening of business.。

(4)Prepare application materials for establishment. Application materials for establishment include application form for establishment.、feasibility study report、Preparatory plan、Basic information of the sponsor、The sponsor's board of directors or shareholders' meeting agrees to initiate a resolution to establish a private bank、Letter of commitment from the sponsor’s true sources of funds、The sponsor’s audited financial reports for the past three years、Legal opinions issued by law firms, etc.。(5)Name pre-approval The company name that has been pre-approved by the industrial and commercial department will be retained for six months.。

[2]in practice，If you have legitimate reasons, you can apply for an extension once。Furthermore we understand，Once a private bank is approved for establishment，The company name should be retained until the end of the preparation period。(6)Submit a preparatory establishment application. The banking regulatory department shall make a written decision of approval (preparatory establishment approval) or disapproval within four months from the date of acceptance of the preparatory establishment application.。The preparation period is six months from the date of approval decision，Can be extended for up to three months upon approval。

1. opening stage(1)After the promoters have paid capital and verified the capital, they have received approval from the China Banking Regulatory Commission for establishment.，The sponsor shall pay its share of capital contribution to the corresponding account in accordance with the sponsor agreement.，After completing the investment，Capital verification by a statutory capital verification agency。

(2)Formulating corporate governance systems and key management systems in general，Corporate governance system includes articles of association、Rules of Procedure for Shareholders’ Meeting、Board of Directors Rules of Procedure、Rules of Procedure of the Supervisory Board、Independent director system and working rules of special committees of the board of directors, etc.；The main management systems should include the bank’s basic systems for internal control and risk management.，For example, authorization management methods、Measures for the Management of Related Transactions、Risk management measures、Information disclosure measures, etc.。

(3)Nominated Director、Supervisors and senior management directors should include executive directors who also hold senior operating and management positions in the bank and non-executive directors who do not hold bank operating and management positions.(Including independent directors)；Supervisors should include supervisors who are employee representatives、External supervisors and shareholder supervisors elected by the shareholders’ meeting；Senior managers should generally include the president of the head office、Vice President、Financial person in charge、Internal audit manager and department chief。

(4)Convene the first meeting of the founding meeting and general meeting of shareholders. The first meeting of the founding meeting and general meeting of shareholders shall review and approve the articles of association.、Rules of Procedure for Shareholders’ Meeting、Rules of procedure for the board of directors and preparation plan, etc.，Review establishment

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，Election of directors、supervisor，Authorize the preparatory working group to carry out follow-up work, etc.。

(5)Convene the first board meeting、After the founding meeting of the Board of Supervisors and the first meeting of the general meeting of shareholders，The first meeting of the first board of directors should be held next、The first meeting of the first Supervisory Board，Elect chairman separately、Chief Supervisor，Establish special committees of the Board of Directors and the Board of Supervisors and review and adopt their working rules，The first meeting of the first board of directors shall review and approve the main management system of the bank.。

(6)Prepare opening application materials. Opening application materials include opening application form.，founding meeting、Board of Directors、Relevant resolutions reviewed and approved by the Board of Supervisors，Articles of Association and Main Management Systems，Proposed director、Materials related to senior management qualifications，An organizational chart that introduces the division of responsibilities, authorization and responsible persons of each department，Capital verification report，Proof of ownership or use rights of business premises, etc.。

(7)Submit an application for business opening The preparatory working group shall submit an application for business opening within six months after the establishment preparation is approved.，Failure to prepare on schedule，An extension application must be submitted to the banking regulatory department one month before the expiration of the preparatory period.，The maximum extension period is three months。The banking regulatory department shall make a written decision on approval (opening approval) or disapproval within two months from the date of acceptance of the application for business opening.。

(8)Get a financial license、After applying for industrial and commercial registration and obtaining the opening approval from the banking regulatory department，Banks should obtain financial licenses，And handle industrial and commercial registration and obtain business license。Banks should open within six months after receiving a business license，Failure to open on time，An extension application must be submitted to the banking regulatory department one month before the expiration of the business opening period.，The maximum extension period is three months。

Basic procedures for setting up private banks based on our experience，In addition to the above procedural content，We believe that the following issues should also be focused on during the establishment process of private banks:：1.Sponsor qualifications Since there are currently no detailed rules for the establishment of private banks,，Private enterprises as sponsors of private banks，The qualifications can be based on the relevant provisions regarding domestic non-financial institutions as promoters in the 2013 "Implementation Measures for Administrative Licensing Matters of Chinese-funded Commercial Banks"。

According to Articles 12 and 13 of the 2013 "Implementation Measures for Administrative Licensing Matters of Chinese-funded Commercial Banks"，The positive and negative conditions for domestic non-financial institutions to serve as bank promoters are as follows:。

Positive conditions refer to conditions that the sponsor must meet，Mainly include：

1. Established in accordance with the law，Have legal personality；
2. Have a good corporate governance structure or effective organizational management methods；
3. Have a good social reputation、Integrity record and tax record，Ability to repay loan principal and interest from financial institutions in full and on schedule；
4. Have a long development period and stable operating conditions；
5. Have strong business management capabilities and financial strength；
6. Financial condition is good，Profitable for the last 3 fiscal years consecutively；
7. After year-end distribution，Net assets reach 30% of total assets (consolidated accounting statement standards)；
8. In principle, the balance of equity investment shall not exceed 50% of the company's net assets (consolidated accounting statement standards)，Except investment companies and holding companies specified by the State Council；
9. The investment funds are self-owned funds，No entrusted funds are allowed、Debt funds and other non-own capital investment，Except as otherwise provided by laws and regulations；
10. Other prudential conditions stipulated in the regulations of the Banking Regulatory Commission。

Compared with the 2006 "Implementation Measures for Administrative Licensing Matters of Chinese-funded Commercial Banks"，Item (9) above is a new requirement proposed in the 2013 "Implementation Measures for Administrative Licensing Matters of Chinese-funded Commercial Banks"

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。

Negative conditions refer to conditions that the sponsor must not meet，Mainly include：

1. There are obvious flaws in the corporate governance structure and mechanism；
2. Many affiliated companies、Equity relationships are complex and opaque、Related transactions are frequent and abnormal；
3. The core business is not outstanding and its business scope involves too many industries；
4. Cash flow fluctuations are greatly affected by economic prosperity；
5. Asset-liability ratio、Financial leverage ratio is higher than the industry average；
6. Hold equity in Chinese-funded commercial banks on behalf of others；
7. Other situations that have a significant adverse impact on the bank。

Compared with the 2006 "Implementation Measures for Administrative Licensing Matters of Chinese-funded Commercial Banks"，Item (6) above is a new requirement proposed in the 2013 "Implementation Measures for Administrative Licensing Matters of Chinese-funded Commercial Banks"

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。

For private banks，Its sponsors are usually private enterprises，Belongs to a domestic non-financial institution，Now the regulators have issued relevant rules，Treat private banks as a separate regulatory sequence，It is possible that special provisions will be made for the qualifications for promoters of private banks.。2.The setting of the main sponsor we think，Private bank establishment projects should have a main sponsor，The main sponsor takes the lead in the project。

It can be seen from real cases and relevant policies and regulations that，The establishment of a bank is a major project related to social interests，Determining the main sponsor (lead person) can effectively promote the project，Coordinate the interests of all parties，Clarify the responsible party，Therefore it is necessary。

Take the establishment of Bohai Bank, the first national joint-stock commercial bank approved to be established since 1996, as an example.，The Tianjin Municipal Government is the leader of the Bohai Bank establishment project，Play a central role in the formation process，Tianjin TEDA Investment Holdings Co., Ltd., which is designated to operate and manage state-owned assets, holds 25% of the equity of Bohai Bank as the main sponsor.，and successfully introduced Standard Chartered Bank (Hong Kong) Co., Ltd. as a strategic investor。

also，2007The "Guidelines for the Approval of the Establishment of Rural Banks" issued by the China Banking Regulatory Commission in 2016 also reflects this idea.，

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To establish a village bank, at least one domestic financial institution must serve as the main sponsor.，And the main sponsor’s shareholding ratio shall not be less than 20%。To sum up，We believe that in the private bank establishment project，It is advisable to set the main sponsor。The main sponsor is the leader of the project to establish a private bank，He is also the founder with the largest number of individual shares held.。

The main sponsor plays a leading role in the establishment process，It enjoys some special rights，Can improve efficiency，For example, during the preparation process，Some sponsors have withdrawn，The main sponsor selects a new sponsor to subscribe for the shares of the withdrawing sponsor，Avoid unnecessary delays in project progress due to individual sponsors。in addition，The main sponsor alone holds the largest number of shares，This means that when a risk occurs, it should bear the largest share of responsibility。

therefore，Taking into account the rights and responsibilities of the lead sponsor，Relatively strict qualifications should be set for it，Put higher limits on their risk-taking capacity

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。According to public information on the Internet and media reports,，There are signs of separate qualifications for main sponsors and other sponsors。

Recently，A "Pilot Private Bank Supervision and Management Measures" that has been circulated in the market but has not yet been confirmed(discussion paper)》 clearly distinguishes the main sponsor and other sponsors，and put forward higher qualifications for the main sponsors，For example

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The main sponsor must have been profitable in the last three fiscal years.，While other sponsors

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Profitable continuously for the last 2 fiscal years。

(1)Issues related to "own risk" given that depositors' deposits in commercial banks are far greater than shareholders' investments，How do commercial banks balance the interests of shareholders and the interests of depositors (the public)?，It has always been an enduring topic in theory and practice。

Currently, many state-owned banks、State-controlled banks implement implicit guarantees to protect depositors，It is not efficient for banks to exit the market，Take Hainan Development Bank as an example，1998In 2006, the bank was suspended for rectification due to a business crisis.，After the People's Bank of China took over，Specify that its deposit claims will be successively managed by the Industrial and Commercial Bank of China。

It is precisely based on this，Regulators regard “owning risks” as one of the basic principles for establishing private banks，This is first reflected in the inability to rely on national credit to provide implicit guarantees for depositors.。Shang Fulin, chairman of the China Banking Regulatory Commission, said，Private banks must have institutional arrangements to bear their own residual risks，Legal and feasible risk treatment and recovery plan，speak in jargon，It’s called a “living will.”。So，Who bears the operating risks of private banks?

we think，From a legal point of view，The nature of private banks is still a joint stock company.，Subject to the "Company Law"，It is difficult for shareholders to break through the basic principle of company law that shareholders bear limited liability in terms of liability.。But private banks are closely related to public interests after all.，Different from ordinary companies，The spillover of its business risks may endanger social stability.。

therefore，Learn from the experience of developed countries and combine it with my country’s national conditions，On the premise of complying with the Company Law，we think，Private banks should be equipped with corresponding corporate governance and risk management regulations，and a series of institutional arrangements such as the national deposit insurance system.，To realize that private banks “bear their own risks”。

In view of the fact that the unified rules and deposit insurance system of "own risk" have not yet been introduced，we think，As Yan Qingmin, vice chairman of the China Banking Regulatory Commission, pointed out，Pilot private banks can independently create a risk-bearing model by the initiators，For example, shareholders can set up and deposit risk funds for banks, etc.，All are worth exploring and trying。

The self-risk system of pilot private banks needs to be tailored by each sponsor and relevant intermediaries according to the specific conditions of the project.，I won’t go into detail here.。(2)Corporate Governance Structure Private banks should build the “three meetings and one layer” that is in line with the modern corporate governance structure，Combined with the particularity of private bank shareholder backgrounds，Its corporate governance structure may consider the following points:：First，Establish a moderately concentrated ownership structure。

The so-called moderate concentration is to prevent over-concentration and over-dispersion - over-concentration of the ownership structure will lead to "one-note speech"，Banks will inevitably become spokespersons for the interests of major shareholders.；Ownership structure is too dispersed，Shareholders are not fully motivated by interests，There is no motivation to run a good bank。Only moderately concentrated equity institutions，Relatively large shareholders can take the lead in solving problems to improve efficiency.，There are other shareholders that restrict and supervise the power of the major shareholder.。

second，Establish and perform their respective duties、Everyone takes responsibility、Cooperate with each other、Corporate governance structure with checks and balances。This item

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It needs to be carried out from the bank establishment stage to the bank's continuous operation stage.，This is specifically reflected in the lower limit on the number of sponsors stipulated in regulations or implemented through documents such as articles of association and sponsor agreements (for example, there must be at least 8 sponsors)、Limits on shareholding ratio of the largest shareholder and its related parties、Systems such as the avoidance of voting by related directors and related shareholders。

third，Adhere to meritocracy、The principle of personnel appointment based on “professionalism”。Compared with state-owned banks that have been immersed in the financial industry for many years，Shareholders of private banks often lack experience in the financial industry，Or those with relatively little experience in the financial industry，To make up for this shortcoming，It is necessary for private banks to implement scientific management、Implementing the introduction of professionals as a basic system of corporate governance。

at board level，Establish an independent director system，Introducing independent directors with senior financial backgrounds，and

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Independent directors should be diligent and responsible，Must meet minimum number of working days and in-person attendance at Board meetings per year

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；In terms of senior management，Deepen the professional system，Introducing professionals with senior financial industry backgrounds as senior managers。fourth，Establish an effective incentive mechanism for senior managers。

Talent is the primary productive force in the 21st century，For private banks，Employees, especially senior managers, are the engine that helps it take off。To encourage senior managers to work diligently and to maintain their stability as much as possible，It is necessary for private banks to link the remuneration and benefits of senior managers with the performance of the bank.、Linking regulatory indicators with social responsibility, etc.，At the same time, an employee stock ownership plan or employee stock option grant plan was launched.，Establish an effective incentive mechanism。

On the basis of performance appraisal，Should pay attention to risk management，Abandon the past performance-based thinking。in fact，In recent years, regulatory agencies have also actively guided banks to re-understand the purpose and connotation of employee incentive mechanisms - the 2002 "Corporate Governance Guidelines for Joint-stock Commercial Banks" only mentioned that commercial banks should establish incentive mechanisms that link remuneration with bank benefits and individual performance.。

However，2012When discussing bank remuneration and performance mechanisms, the "Corporate Governance Guidelines for Commercial Banks"，It is clearly emphasized that the standards for performance appraisal should reflect the principle of protecting the legitimate rights and interests of depositors and other stakeholders.，Ensure that the bank’s short-term interests are consistent with long-term development，Balance benefits and risks，Performance appraisal indicators should include economic benefit indicators、Risk management indicators and social responsibility indicators。

Conclusion We think，This wave of establishment of private banks，Reflects the single path of private capital entering the banking industry from capital access in the past.，Transforming into a dual path of coexistence of capital access and institutional access is the future development direction of my country's banking industry。Private banks are new products of my country’s financial reform，The corresponding establishment projects are still in the exploratory stage.，Therefore, it is inevitable to encounter some existing laws and regulations that do not clearly provide for，However, problems that cannot be avoided in practice。

To ensure that private banks are legal、Established in compliance with regulations and successfully developed on the right track after establishment，Private bank establishment projects require close coordination between all relevant parties、All things considered，and jointly in finance、Experienced professional institutions in the field of legal services jointly design the system，In order to seek innovation and breakthroughs within the current legal framework，Thereby promoting the diversified development of the ownership structure of financial institutions in my country.，and further stimulate the market vitality of financial institutions。

(source：King & Wood Mallesons Author：King & Wood Mallesons Lixin Dongni Guan Lifeng (abridged from the original text) Further reading：China Banking Regulatory Commission’s new regulations on private banks require that boards of directors of private banks should establish separate related party transaction control committees Source：Writer of The Paper：Yingying was at the time when the China Banking Regulatory Commission was intensively approving private banks.，Don’t forget to formulate new regulations，To promote the compliance operation of private banks。

2025January 5，The China Banking Regulatory Commission issued the "Guiding Opinions on the Supervision of Private Banks" (hereinafter referred to as the "Guiding Opinions")。This document is the second document on private banks released so far.，Clarify various aspects of supervision of private banks

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，Clear development positioning，Encourage innovation and development，and implement the responsibilities of regulatory authorities。

The only previous document on private banks was the "Guiding Opinions on Promoting the Development of Private Banks" published by the State Council in June 2025.，The "Guiding Opinions" issued this time have formulated more specific supervision

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。

"Guiding Opinions" on the management of related transactions of private banks、Equity Management、Proposed supervision in key areas such as shareholder supervision

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，

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Strengthen bank self-discipline、Market constraints and regulatory constraints，Guide shareholders of private banks to increase credit for banks，Form a positive mechanism for shareholders to care about the development of the bank and for the bank to effectively manage risks.，Improve the sustainable development capabilities of private banks。

in，The Guiding Opinions clearly stipulate，The board of directors of private banks should establish a separate related party transaction control committee，Responsible for the management of related party transactions、review and approval。2014Annual submission to the State Council for approval，China Banking Regulatory Commission launches pilot program for private banks，The first batch of five pilot banks have all been approved to open.。2025June，After the promulgation of the "Guiding Opinions on Promoting the Development of Private Banks"，The establishment of private banks has been transformed from pilot to regular establishment.。

Up to now，Including five pilot banks，The China Banking Regulatory Commission approved the establishment of 17 private banks in total，The development of private banks has entered a period of reform and development opportunities。

attached：Guiding Opinions of the China Banking Regulatory Commission on the Supervision of Private Banks Various Banking Regulatory Bureaus：In order to implement the spirit of the document "Guiding Opinions on Promoting the Development of Private Banks" (Guobanfa [2025] No. 49)，Carry out continuous supervision of private banks，Promote private banks to operate in compliance with laws and regulations、Scientific and steady development，The following guidance is hereby put forward：one、overall

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Adhere to the principle of equal emphasis on prudent supervision and innovative development，Accelerate the transformation of functions，Clarify regulatory responsibilities，form regulatory unification、Clear rights and responsibilities、Operational coordination、Safe and efficient private bank supervision system，Provide guarantee for the steady development of private banks。

Adhere to full supervision、The principle of unifying innovation supervision and collaborative supervision，Strengthen institutional constraints，Strengthen supervision and guidance，Communicate and coordinate well。Adhere to the principle of combining unified supervision and differentiated supervision，Urging private banks to comply with various prudential regulations on commercial banks

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，According to the characteristics of private banks，Implement differentiated regulatory arrangements。Adhere to the principle of linking pilot experience with regular establishment，Effectively implement the five principles for the establishment of private banks initiated by private capital。

two、Clarify development strategy (1) Characteristic operation。Private banks should establish scientific development directions，Clarify differentiated development strategy，Develop practical business policies，play comparison

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，Adhere to characteristic management，Achieve complementary development with existing commercial banks、Misplaced competition。(2) Market positioning。

Private banks should focus on developing deposit、loan、Basic business such as remittance，For the real economy, especially small, medium and micro enterprises、“Agriculture, rural areas and farmers” and communities，and mass entrepreneurship、Wanzhong Innovation provides more targeted、More convenient financial services。

1. Innovation model。Encourage private banks to explore and innovate "large deposits and small loans"、Differentiation such as “personal deposits and small loans”、Distinctive business model，Improve matching with financial needs of market segments。
2. Technology application。

Support private banks in utilizing big data、cloud computing、New generation information technology such as mobile Internet，launch products、Serve、Management and technological innovation，Provide inclusive financial services，For the sustainable development of the banking industry、Innovation and development inject new impetus。three、Implement prudent business rules (1) Corporate governance。

Private banks should strengthen self-discipline，Improve corporate governance and internal control systems，Establish a corporate governance structure that meets development strategy and risk management needs，Establish and improve shareholders’ meetings、Board of Directors、Supervisory board system，Clarify responsibilities and rules of procedure。Improve the board's ability to perform its duties，The board of directors should be diligent and responsible、Honesty and trustworthiness，And assume the ultimate responsibility for bank operation and management。(2) Capital management。

Private banks should strengthen capital management，Strengthen capital constraints，Establish a sustainable capital replenishment mechanism，Ensure capital levels continue to meet regulatory requirements

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，Fully protect against all types of risks。

1. risk management。Private banks should strengthen risk management，Scientifically set risk preferences，Improve risk management policies and procedures，Improve comprehensive risk management levels，Effectively prevent various risks。
2. Related party transaction management。

Private banks should strengthen management of related transactions，Strictly control related credit balances，Illegal related party transactions are strictly prohibited。Encourage private banks to specify in their articles of association or agreements，Major shareholders but not limited to major shareholders and their related parties do not obtain related credit facilities from the Bank。The board of directors of private banks should establish a separate related party transaction control committee，Responsible for the management of related party transactions、review and approval。(5) Equity management。

Private banks should strengthen equity management，Regulate shareholders’ shareholding behavior，When conditions are ripe, the equity will be centrally managed to a qualified custody institution.。Encourage private banks to specify in bank charters or agreements，Major shareholders, but not limited to major shareholders, will not use their equity in the Bank as a guarantee for themselves or others (including equity pledge)。Four、Strengthening shareholder supervision (1) Shareholder qualification management。

Shareholders of private banks shall comply with relevant regulatory

Require

，Issue a statement on the source of investment funds、Statement on the actual controller and written commitments of the shareholders (general meeting) or the board of directors, etc.。The actual controller of the shareholder should promise that he is a Chinese citizen and does not hold the nationality of other countries or regions.、Permanent residence and similar status，And promise not to seek to apply for nationality of other countries or regions while holding shares in private banks、Permanent residence and similar status。(2) Bearing residual risks。

Private banks should specify in their articles of association or agreement，Institutional arrangements for shareholders to bear residual risks，Promote shareholders to increase credit for banks，Implement shareholders’ responsibilities in the bank resolution process。(3) Shareholders accept supervision。Private banks should specify in their articles of association or agreement，Relevant provisions for shareholders to accept supervision，Including but not limited to shareholders reporting information and accepting extended supervision。

Shareholders of private banks shall promptly submit the following information to the local banking regulatory bureau through the private bank holding shares:：Audited corporate annual financial accounting report；Changes in corporate registered capital, divisions and mergers；Changes in equity ownership of more than 5% (inclusive)、Changes in actual controlling parties and introduction of strategic investors, etc.；Changes in related parties；Major litigation、Disputes and major risks、Major business changes；Banking Regulatory Commission

Require

Other information to submit。(4) Shareholder Performance Assessment。

The board of directors of a private bank shall conduct a self-assessment at least annually on the performance of shareholders' commitments and the implementation of the bank's articles of association or agreements.，And submit the evaluation report (with legal opinion attached) to the local banking regulatory bureau in a timely manner。Local banking regulatory bureaus should regularly reassess the self-assessment of private banks.，and use this as an important basis for taking regulatory measures。(5) Shareholder information disclosure。

Private banks should submit shareholder statements、Commitments and shareholder performance are included in the scope of information disclosure as major matters，Strengthen market discipline，Increase transparency。(6) Strict supervision and accountability。The China Banking Regulatory Commission and its dispatched offices may, based on prudential supervision needs，Take relevant supervisory measures against shareholders of private banks in accordance with the law，including but not limited to

Require

Shareholders and their legal representatives、The actual controller explains the relevant situation，or submit relevant documents、Information, etc.。

Failure to perform obligations or other inappropriate behavior towards shareholders of private banks，Causing private banks to violate prudent operating rules，The China Banking Regulatory Commission and its dispatched offices shall take corresponding supervisory measures in accordance with Article 37 of the Banking Supervision Law and include shareholder-related information in the management of bad records.。five、Improve the regulatory mechanism (1) Strengthen prudential supervision。

The China Banking Regulatory Commission and its local offices should urge private banks to strictly comply with various prudential regulations.

Require

，Improve risk monitoring and evaluation system，Strengthen early identification and early warning of major risks in private banks，Make supervision more scientific、level of refinement。(2) Innovative supervision methods。

The China Banking Regulatory Commission and its local offices should strengthen supervision and guidance，Innovative regulatory tools，Close to the new situation of private bank development、new

Require

，Support private banks to be guided by market demand，Give full play to the market mechanism

Advantages

，In compliance with the law、On the basis of controllable risks，Steadily promote business innovation、Service innovation、process innovation、Management innovation，Improve the level of sustainable development。Remarkable results in characteristic operations and provision of inclusive financial services，Implement regulatory positive incentives。

1. Implement territorial responsibilities。The China Banking Regulatory Commission and its dispatched offices should optimize regulatory resources，Clear division of work，Strengthen regulatory linkage。Local banking regulatory bureaus should effectively fulfill their local regulatory responsibilities，Undertake market access for private banks、Offsite supervision、On-site inspection and risk management and other work responsibilities。Administrative licensing procedures for private banks、Offsite supervision、On-site inspections, etc. shall be carried out in accordance with city commercial banks.。
2. Develop recovery and disposal plans。

The China Banking Regulatory Commission and its local offices should urge private banks to formulate legal and feasible recovery plans and cooperate with regulatory authorities in formulating resolution plans.，Clear division of responsibilities、Business processes and work

Require

，Strengthening shareholder responsibility in bank recovery and resolution processes，and in accordance with relevant regulations

Require

Timely submission and revision。(5) Improve the risk disposal mechanism。

The China Banking Regulatory Commission and its dispatched offices should strengthen information sharing, communication and collaboration with relevant departments and local governments at all levels.，Jointly establish and continuously improve coordination mechanisms for private bank emergencies and market exits，Clarify the responsibilities of all parties，Refine workflow，Prevent and deal with major risks promptly and effectively。

The term “major shareholders” as mentioned in this guidance refers to those who can directly、indirect、Jointly hold or control more than 5% (inclusive) of the shares or voting rights of a private bank，and shareholders who have significant influence on private bank decisions.。

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