China unveiled a package of policies to tackle the pressing challenges faced by the financial sector at a top-level conference held over the weekend.

Among the key initiatives announced by Premier Wen Jiabao at the two-day National Financial Work Conference which is held every five years were:

The three policy banks, which are State-owned lenders that concentrate on meeting the country's economic goals instead of profitability, will be commercialized, starting with the China Development Bank. The other two are the China Export and Import Bank and the Agricultural Development Bank of China.

Agricultural Bank of China (ABC) will be restructured. ABC is the only one of the "Big-Four" State-owned banks not listed.

"ABC will strengthen its role as a financial service provider for farmers and county-level businesses," Wen said, adding that the restructure would be across the board and the bank's businesses would not be split.

The government will push for innovation in providing financial services for rural areas and build a multi-tier rural financial structure.

The bond market will receive special attention in the development of the capital market with an emphasis on corporate bonds.

Managers of the country's huge foreign exchange reserves are encouraged to "explore new means and extend channels" for the use of the money.

Wen admitted that "quite a number of problems exist... we must use forceful means to solve them". He reiterated some constant themes of recent years for the financial sector's development deepening reforms at State banks to enhance their commercial viability, improve the financial markets' depth and sophistication and beef up financial authorities' capability to fine-tune the economy with market-based tools.

Wen said the country will steadily advance the financial industry's further opening and promote fair competition between Chinese and overseas institutions.

The financial work conference has been held twice before in 1997 and 2002 and both led to substantial reforms.

Source:China Daily