China’s banking system is not without its problems.
The largest state-owned banks are known to favour state-owned enterprises when lending money. Meanwhile, households earn very low interest on their deposits.
Now, Yao Jingyuan, a former chief economist for China’s National Bureau of Statistics is out lampooning the nation’s banking system.
He said most bankers had become “freeloaders” profiting off the difference between interest rates on deposits and loans, according to South China Morning Post. He also pretty much said that a dog could run the nation’s banking system. From SCMP:
“Banking in China has become like a highway toll system. Banks charge every time money goes through them.
“With this kind of operational model, banks will continue making money even if all the bank presidents go home to sleep and you replaced them by putting a small dog in their seats.”
China has been talking about pushing through a deposit insurance scheme which is considered crucial to opening up the financial sector.
It has yet to lift the ceiling on deposit rates which is considered crucial to interest rate liberalization.
Business Insider Emails & Alerts
Site highlights each day to your inbox.