BEIJING, Jan. 29 (Xinhua) -- A senior Chinese banking regulator on Tuesday warned of risks in banks' wealth-management products, a popular financial product in China, as a frenzy to snatch depositors has led to non-standard operations.
Some lenders have failed to disclose sufficient information on the products to their clients, and some are weak in risk management, Wang Yanxiu, head of the novel products department under the China Banking Regulatory Commission, said at a conference.
To correct the situation, the commission will carry out checks over the financial products and work to improve financial services regulations this year, Wang said.
Wealth management businesses have boomed in recent years as competition for depositors among Chinese banks increased following government efforts to push market-based interest rates. The lack of investment channels has also made the products popular among depositors.
Recent media reports have revealed several cases of big losses in banks' wealth management products, highlighting the market's risks and regulatory loopholes.
Data from the commission showed that the balance of banks' wealth management products currently totals around 7.1 trillion yuan (1.13 trillion U.S. dollars), more than 13 times the amount at the end of 2007.
Because the business only accounts for around 5 percent of the total assets of the banking sector, its risk is controllable and it still has great development potential, according to Wang.