• CBRC Chairman Guo Shuqing

CBRC Chairman Guo Shuqing (Photo : Getty Images)

 authorities are stepping up efforts to crack down on financial market malpractice such as insider trading, while the China Banking Regulatory Commission (CBRC) unveiled new measures aimed at addressing risks in the banking sector, the  Xinhua News Agency reported.

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CBRC said that it will intensify risk control measures on ten fields in traditional sectors such as real estate, credit, liquidity and local government debt, as well as in non-traditional areas that include Internet finance and cross-border financial deals.

According to the report, the issuance of the CBRC policy guidelines came after China's top anti-graft authority announced on Sunday, April 9, that it is investigating Xiang Junbo, chairman of the China Insurance Regulatory Commission, for suspected serious violations of the code of conduct of the Communist Party of China.

Last year, Yao Zhenhua, chairman of Foresea Life Insurance, was barred from the insurance industry for 10 years by China's insurance regulator due to irregular market operations.

Last month, Xian Yan, chairman of P2P Financial Information Service Co., was fined 3.47 billion yuan (about $503 million) for violations that included stock market manipulation and insider trading.

"Small fines fail to pose as a deterrent to banks and investors engaged in malpractice, and regulators must take more punitive actions to strengthen their supervision," Zeng Gang, an economist with the Chinese Academy of Social Sciences, said.

"Preventing financial risk will be on the front burner, and regulators will slap harsh punishments on market violators to curb frequent misbehavior," Liu Fushou, director of the legal department of the CBRC, said.

In the first quarter of this year alone, the CBRC imposed administrative penalties for 485 cases of irregularities in the sector with fines totaling 190 million yuan, equaling 70 percent of the total amount of fines issued last year.

Analysts said that some investors take advantage of the loophole in the market regulation as the country's bond, stock, insurance, banking and other financial markets are only in their early stages.

Guo Shuqing, chairman of the CBRC, said that this requires the government to keep abreast of the new changes and update its supervisory rules.

The country's financial regulators also vowed to prioritize innovation in their supervisory powers to include better on-site surveillance and the use of big data to improve their performance.