China's $13tn shadow banking sector gets clearer definition

Top bank regulator lists criteria for determining threats to financial system

20201206 Caixin China banking regulator

China’s shadow banking sector shrank to 84.8 trillion yuan from a peak of 100.4 trillion yuan in 2017, according to a regulatory report.

WU XIAOMENG and DENISE JIA, Caixin

China's top banking regulator for the first time defined the criteria, scope and classification of the country's nearly $13 trillion shadow banking sector in a continuing effort to defuse systemic financial risks as the country expands credit to support recovery from the pandemic.

The China Banking and Insurance Regulatory Commission listed four criteria to define shadow banking and divided the sector by a broad definition and a narrow definition in a Friday report by the agency's policy research bureau.

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