Governors of China's state-owned commercial banks at all levels will be stripped of the power to approve loans in the future, according to an official with the State Banking Regulatory Commission.

Shen Xiaoming of the commission compared the bank governors to university presidents. "Their future job is only in charge of administrative affairs, local marketing and business expansion," he said, quoted by Saturday's Economic Information Daily.

The move is aimed to help deal with China's increasing bank scandals that involve bank governors at various levels with "too big power."

Shen spoke highly of the share-holding and foreign-funded banks for their effective management system, saying that their collective decision-making system is superior to that of the state-owned commercial banks.

"This is why the Bank of China, the China Construction Bank and the Industrial and Commercial Bank of China are currently trying to introduce the share-holding system and strategic investors," Shen said.

He revealed that the state-owned commercial banks have already set up a loan-approval committee and bank governors are no longer allowed to directly take part in the loan approval procedure.

Vice governors will be responsible for the approval procedure in rotation, he added.

Source: Xinhua