Why China Is Targeting the State Bank Monopoly

On Tuesday, China’s premier suggested that momentous changes were coming to the country’s financial sector.  “Frankly, our banks make profits far too easily,” Wen Jiabao said on state-run China National Radio.  “Why?  Because a small number of major banks occupy a monopoly position, meaning one can only go to them for loans and capital.”  China’s top economic official then made a startling suggestion:  “That’s why right now, as we’re dealing with the issue of getting private capital into the finance sector, essentially, that means we have to break up their monopoly.”