Are All Banks Treated as Equals? The Case of Fully Foreign-Funded, Locally Incorporated Banks in China

Abstract

This paper provides a preliminary assessment of the equality of treatment of two classes of locally incorporated banks in China: fully foreign-funded and locally-funded. It presents a brief review of changes to legal requirements associated with foreign funded banks, and reviews differences in a range of key performance metrics. The paper concludes that there is evidence for differences in the treatment of the two forms of locally incorporated banks.

Keywords: banking, bank regulation, China

JEL Classification: G21, G28