The reform of Chinese banking system was undertaken by Deng Xiaoping in 1978. During this structural change, the central bank of the People’s Republic of China departed the ministry and became a separate entity. The People’s Bank of China was formally established as the central bank in 1983 by the State Council. As a result of the reforms of Deng Xiaoping China underwent a change of monobank system to two-tier banking system.
Moreover, the function of the People’s Bank of China as a central bank was formally confirmed in 1995 when the third Plenum of the National People’s Congress adopted The Law of the People’s Republic of China on the People’s Bank of China.
The China Banking Regulatory Commission (CBRC) is the supervisor of the financial institutions in the People’s Republic of China. The central government established this institution in March 2003. The State Council is the leadership of the CBRC. The main functions of the China Banking Regulatory Commission is the formulation of supervisory rules and regulations concerning the Chinese banking institutions, the authorization of the establishment, changes of the financial institutions and also the compilation and publishing of the statistics and reports of the banking industry