China's Xi tells central bank to play bigger role in managing financial risk

China's central bank will take on a bigger role in macro-prudential management and in averting systemic risk in the financial system, President Xi Jinping said at a once-in-five-years government work conference that ended on July 15.

Financial security is a vital part of national security, Xi said at the fifth National Financial Work Conference, adding that China will strengthen the Communist Party's leadership in the financial sector.

A Financial Stability and Development Committee will also be set up under the State Council, or cabinet, state media cited Xi as saying.

No details were given on the committee and on how the role of the People's Bank of China (PBOC) will be strengthened.

Fragmented oversight of China's financial sector has led authorities to worry about "giant crocodiles", a term that regulators have started using to describe law-breaking tycoons who circumvent regulations to grab control of other companies.

As a result, funds are illegally spent on buyouts and acquisitions and are not being used by companies to spur growth in the real economy.

Earlier this year, the China Insurance Regulatory Commission (CIRC) banned the chairman of Foresea Life from the insurance business for 10 years, citing violations of rules in the firm's use of insurance funds.

CIRC separately also restricted Evergrande Life's stock trading activities for one year, after accusing the insurance firm of engaging in irregular investment activities.

Finance is the "blood and pulse" of the economy, and it is the sector's "divine vocation" to serve the real economy, the official Xinhua News Agency quoted Xi as saying.

Xi called for greater accountability for financial regulators at the meeting, saying it...