Licenses for private banks coming soon

Private capital will also be encouraged to participate in the restructuring and reform of existing financial organizations.

"No detailed documents have been released by the central government on how private-sector banks will work, with what kind of financial services, so it is quite hard to tell how big the changes will be to the current system," said Jin Lin, a senior banking analyst with Shanghai-based Oriental Securities Co Ltd.

Jin added that there won't be any obvious effect on the operations of existing financial organizations, as the government won't allow the private banks to conduct all types of financial services.

Entrepreneurs in Wenzhou, Zhejiang province, have sought repeatedly over the past two or three years to launch private banks.

Several chambers of commerce submitted a draft plan for private banks to the city government in June 2012 and again a year later. Neither plan received a response.

"We are keen to help more small and medium-sized enterprises with temporary financial problems by raising money from successful large enterprises and overseas returned businessmen," said Jiang Yongzhong, head of the Wenzhou Chamber of Commerce branch in Jinhua, also in Zhejiang province and one of the initiators of the plan.

Lacking any detailed guidelines from regulators, it's very difficult for private-sector holders of capital to make further moves.

"Hopefully, the 'two sessions' will bring us goods news about allowing private capital to enter the banking sector, which will make our previous efforts worthwhile," said Jiang.

Private banks in the works

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