Jiang Jianqing, president of the Industrial and Commercial Bankof China (ICBC), said the ICBC would make every effort to complete its targeted reform for a shareholding bank by 2006 and thus realize its goal of getting listed on the stock market.

Jiang is attending the 35th annual meeting of the board of governors of the Asian Development Bank (ADB), which ended in Shanghai on Sunday.

Presidents of the Bank of China (BOC) and the Construction Bank of China (CBC) also disclosed their respective reform plans and going-public schemes.

It is noticeable that all these banks acknowledged that listing on the stock exchange is not their ultimate goal, but a driving force behind their development.

They want to resolve their problems and increase their competitiveness through carrying out standardized reforms and optimizing management structure.

And all these banks no longer keep their non-performing loans as a secret, but on the contrary invite international accounting firms to audit their non-performing loans and release the relevant information on a regular basis.

According to China's commitments for its entry into the World Trade Organization (WTO), more foreign banks will enter China with broader ranges of services in coming years. This is sure to bring more challenges to Chinese banks.

Zhang Enzhao, president of the CBC, cited, among others, a series of problems plaguing his bank, including the excessive high rate of non-performing loans, insufficient rate of capital sufficiency, incomplete management structure, irrational organization, lack of support with information technologies for business development, and inadequate assistance to upgrading products.

To solve these problems, Zhang said, it is the most pivotal to establish a sound management structure and an internal management mechanism as is operated in other companies.

The rate of the CBC's non-performing loans was 19.35 percent by the end of 2001, he noted, and it dropped by 1.21 percent in the first quarter this year.

The CBC president pledged to "dissolve the load" left over in history and further cut the rate of non-performing loans to less than 10 percent within five years with the support of the central government's macro-economic policies.

Meanwhile, he said he was confident that the CBC would be the first of China's four commercial banks to implement the planned shareholding system reform and the first to be listed on the stock market.

Jiang Jianqing, ICBC president, said that over many years, China's banks had been run under a planned economic system and could not adapt to the requirements of a market economy in terms of their service mindset, organization, management, qualification of staff, and scientific and technological standards.

Moreover, he disclosed, the ICBC had made major reforms to optimize its performance, including publication of its assets quality in accordance with international norms and inviting international accounting firms to audit the assets quality and operation of Shanghai and Zhejiang branches.

Li Ruogu, assistant to the president of the People's Bank of China (PBC), said that the Chinese government and the country's banking sector were confident in the reform of commercial banks.

He predicted that China's state-owned commercial banks would be fully capable of competing with foreign banks in five years.

( May 13, 2002)