The People’s Bank of China has issued a statement that reconfirms the ban on banks acting as stockbrokers. Facing greater competition from foreign institutions, domestic banks have been lobbying the central bank to expand their business by moving into the securities and insurance sectors.
While the central bank has maintained the separation of these activities, some banks have used innovative ways to diversify. For example, Bank of Communications has established wholly owned insurance businesses on the mainland through its Hong Kong subsidiaries.