China’s financial risks are, on the whole, moderating, said Pan Gongsheng, deputy governor of China’s central bank the People’s Bank of China (PBOC).

Preventing and defusing financial risks has topped the agenda for PBOC for years. The country’s financial risks have shifted from rapid accumulation mode to the current phase of high-level slow-release, Pan said.

“We can see that positive results have been achieved. The financial risks are on the whole, moderating,” Pan said.

The deputy governor added that China’s financial risks have changed due to factors at home and abroad, in the meantime, the priority of risk prevention and control has also changed. Therefore, PBOC must adhere to the bottom line and strengthen risk awareness.

According to Pan, firstly the central bank should handle risks in key areas in a safe and orderly manner. Secondly, PBOC will accelerate the establishment of a more scientific and effective financial regulatory system. And thirdly, it will improve the corporate governance of financial institutions.

“We should strengthen macro-prudential management, enhance the effectiveness of financial supervision, strengthen the coordination of financial supervision, enhance the synergy of financial supervision, and accelerate the establishment of a risk management and bankruptcy mechanism for financial institutions,” Pan stressed.

Moreover, the deputy governor also indicated that the central bank will do more to encourage equity financing and diversify financing services in the banking sector.