(Bloomberg) -- China will continue to open up its $60 trillion financial market to foreign banks and investment firms, while sticking to the bottom line of preventing systemic risks, the nation’s new top regulator said.

The nation will “unswervingly” open up its financial sector and welcome quality foreign financial institutions to China, Li Yunze, head of the National Financial Regulatory Administration, said at the Lujiazui Forum on Thursday in Shanghai.

“Opening up is China’s long-standing state policy, and the door for opening up the financial sector will only be wider,” said Li, a former vice governor of Sichuan province who was named chief of the new financial regulator last month in a regulatory overhaul. 

Growing tension between China and the US is unnerving global investors. While China has pledged to continue its financial opening, authorities have recently cracked down on access to broad swath of data, raided consulting firms as the US is mulling further restrictions on investing in the Communist Party-ruled nation. 

Yi Huiman, chairman of China Securities Regulatory Commission, also said at the forum that China will push for more open markets while ensuring to stabilize market confidence. 

The comments come as global banks are reassessing their ambitions in China, cutting revenue forecasts and trimming staffing. Still, the world’s second biggest economy is still a potent lure. JPMorgan Chase & Co. last month held a summit for clients in Shanghai, with Chief Executive Officer Jamie Dimon pledging to remain in the country in both good times and bad.

Earlier this week, Citigroup Inc. Chief Executive Officer Jane Fraser was in Beijing, where she met with the top regulator. Fraser expressed confidence in China’s financial and economic development, and vowed to keep expanding onshore operations during her Monday meeting with the nation’s top financial regulator, according to an official statement. 

“The overall risk in China’s finance industry is controllable, and we’re fully confident and able to safeguard the bottom line of preventing systemic risks,” Li said at the forum. 

‘Strong Warning’

While recent international banking risk events have had little direct impact on China, they have served “as a strong warning,” according to Li. 

“The National Financial Regulatory Administration will take a more proactive attitude to address various risks and hidden dangers, adhere to the principle of ‘early identification, early warning, early detection, and early disposal’ and strive to resolve risks in their early stages,” Li said. 

Efforts will also be made to plug loopholes in China’s financial regulation and resolutely prevent new risks from brewing. Li has pledged to bring all types of financial activities under supervision and eliminate regulatory blind spots. 

China has made containing financial risk one of the top priorities this year even as it battles to revive the economy after late last year abandoning its Covid-zero approach. 

The CSRC will dissolve bond default risks in an orderly manner, crack down on violations including insider trading and step up monitoring of quant trading as part of its efforts to improve market regulation, Yi said at the forum.

Economic Boost

Beijing has rolled out a raft of measures to prop up the economy, including efforts to boost bank lending after recent data showed a slowdown. Authorities have so far refrained from cutting interest rates and sharply increasing fiscal spending, concerned by financial stability risks after local government debts soared. 

After spiking in the first quarter, credit and new loans weakened in April as consumers and businesses curbed their borrowing. Households are saving more and paying down their mortgages, rather than taking on more debt, while businesses are faced with falling demand and declining profits. 

Li pledged to step up financial support to the real economy, especially in areas like consumption, and improve financing for private firms. “We will continue to optimize financial services, in order to recover and expand effective demand” in the economy, he told the forum. 

The CSRC will support China’s technological innovation in a more “targeted” approach, by beefing up equity and bond financing as well as REITs offering for mergers and acquisitions, according to Yi. 

“While the domestic economy has showed momentum of a recovery, the internal drive isn’t strong yet,” said Yi. “We still need to overcome many difficulties and challenges to promote a high-quality development.” 

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