In 2001, monetary operation saw overall steady advancement and monetary policies saw appropriate adjustment. The Central Bank continued to implement stable monetary policies, and applied various monetary policy tools to adjust currency supply, so that currency supply maintained smooth development. It timely adjusted re-discount interest rate, put the interest rate system in order; strengthened coordination policies of domestic and foreign currency interest rate; and cut down the interest rate of US dollars and other foreign currencies deposit at small amounts for many times. The RMB exchange rate remained steady and the national foreign exchange reserves saw a large increase. The loan structure saw further rectification with significant growth on industrial loan, personal consumption loan and invoice discount loan; and the loan quality witnessed further improvement.

Financial supervision and management saw gradual intensification. In a bid to standardize operations of financial institutions, maintain financial market orders and prevent and even ease financial risks, the People’s Bank of China promulgated Guide on Financial Supervision and Management (Pilot), Regulations on Management of Trust Investment Companies, and Interim Regulations on Intermediary Operations of Commercial Banks. This intensified the management on short-term loan, stock mortgage loan and voucher loan by security companies, and investigated illegal listing of security companies. In an attempt to intensify supervision and management of bank loan risks, the People’s Bank of China made a decision to implement five categories of management regulations on loan risks from 2002.

The security market made a key stride forward on standardization development. Reform was made on stock issue methods. The approval system of initial public offering was applied; it announced a key step toward marketization of stock issue. The Regulations on Implementation of Listing Pause and Termination of Deficit Listed Companies was promulgated to initially establish the delisting system of listed companies. The Regulations on Administration of Chinese Listed Companies was released to further perfect administration structure of listed companies, and exploration was made to establish the independent board director system of listed companies. The Regulations Concerning Edition and Report of Information Disclosure of Public Offering Security Companies was released to further intensified information disclosure of listed companies. The Circular Concerning Standardization of Security Transaction in Security Investment Fund Operations was released to further standardize transactions of security investment fund. The B shares market was opened to domestic residents and thus broadened the investment channel for domestic residents. National institutional workers were allowed to participate in security investment. The stamp tax rate was further reduced on stock transaction. The debt bond market saw steady development; the debt bond structure turned reasonable; the issue mainstream became manifold and enterprise debt bonds began to rise.

The insurance industry saw a speedy reform step. In line with China’s entry into the WTO, insurance companies made breakthroughs on reform and reconstruction and speeded up the listing step. The premium income experienced a rapid increase throughout the country and the business structure saw continuous improvement. Each insurance company especially life insurance companies actively adjusted product structure and continuously developed such updated products as investment link and dividends in line with market demands. The China Insurance Regulatory Commission added efforts to investigation on a mass of insurance company branches and foreign-invested insurance companies.

The bank reconstruction and transformation experienced systematic advancement; great efforts were put to treatment of non-performing assets. The China Silver Group saw a smooth reconstruction and listing, and local shareholding banks witnessed a systematic transformation and listing. State-owned commercial banks continued to strengthen internal reform and risk management; and the non-performing loan rate was cut down. Upon two years, four major companies on financial asset management acquired various non-performing assets totaling about RMB1,400 billion yuan from wholly state-owned commercial banks and state development banks. The four asset management companies handled book assets with total worth of RMB 124.507 billion yuan, and got back cash of RMB26.146 billion yuan. Especially, the China Great Wall Asset Management Corporation topped among them with total non-performing assets treated of RMB 53.106 billion yuan.