China Unveils 15th Five-Year Financial Powerhouse Plan

China has officially released the Financial Powerhouse Construction 15th Five-Year Plan, a blueprint that sets the strategic direction for strengthening the country’s financial system over 2026-2030, with a longer-range vision to 2035. People’s Bank of China (PBOC) Deputy Governor Lu Lei announced the plan at a State Council Information Office (SCIO) press conference on September 10, describing it as the “overall strategy and specific blueprint” for financial work during the 15th Five-Year Plan period. He was joined by senior officials from the National Financial Regulatory Administration (NFRA), the China Securities Regulatory Commission (CSRC), and the State Administration of Foreign Exchange (SAFE).

Two-Stage Goals

According to Securities Daily, the plan lays out goals for two distinct horizons. By 2030, China aims to form the overall framework of a modern financial system with Chinese characteristics — with coordinated and effective financial regulatory policies, a rationally optimized system structure, tight supervision, precise risk prevention, and a steadily expanded high-level financial opening. By 2035, the plan calls for basically completing a modern financial system that is “highly adaptable, competitive, and inclusive,” laying a solid foundation for building a financial powerhouse.

To implement the plan, the PBOC issued its own PBOC “15th Five-Year” Reform and Development Plan together with nine supporting action plans, anchored to what officials call the “six core elements” of financial powerhouse construction.

Five Priorities for the Central Bank

Lu outlined five focus areas for the PBOC. The first is building a “dual-pillar” framework combining the monetary policy system and a comprehensive macro-prudential management system. This includes doing counter-cyclical and cross-cyclical adjustment, keeping the growth of social financing and money supply in line with economic growth and price expectations, and improving the market-based formation, regulation, and transmission of interest rates.

The second priority is serving the real economy — supporting major strategies, key areas, and weak links, and advancing the “five major articles” of finance: technology, green, inclusive, pension, and digital finance. The PBOC said it would build a technology finance system suited to scientific and technological innovation and construct a high-quality “tech board” in the bond market.

The third focuses on financial structure, including developing open, inclusive, and resilient modern financial markets, raising the share of direct financing, and better leveraging financial markets to promote “new quality productive forces.” The fourth covers opening-up: advancing RMB internationalization, deepening two-way opening of financial markets, developing the offshore RMB market, and speeding up the building of Shanghai as an international financial center while consolidating Hong Kong’s status as one. The fifth priority is the central bank service system, including strengthening financial infrastructure, steadily developing the digital RMB (e-CNY), and advancing anti-money-laundering supervision.

A Shift in Monetary Policy

In a notable policy signal, Lu said the PBOC would “gradually reduce reliance on quantitative intermediate targets and put more emphasis on the role of interest-rate-based control tools,” per Kankan News. The central bank plans to improve its base money supply mechanism and reserve requirement system, conduct open market operations more flexibly and precisely, and guide short-term money market rates to move smoothly around the policy rate.

On the exchange rate, Lu stressed that China implements a managed floating exchange rate system and insists on the market’s decisive role in rate formation. “China has no need and no intention to gain trade competitive advantage through exchange rate depreciation,” he said.

A Tougher Regulatory Stance

NFRA Vice Administrator Cong Lin said the regulator would “effectively prevent and resolve risks of local small and medium-sized financial institutions in an orderly manner, firmly holding the bottom line of no blow-ups.” Cong said the agency would comprehensively strengthen the “five major supervisions,” making supervision “toothy and angular,” and would vigorously rectify unfair competition including “price wars,” illegal rebates, and “high interest-high return” behaviors.

Cong also pointed to the health of the system, noting that by the end of 2025, commercial banks’ provision coverage ratio stood at 205.21 percent and their capital adequacy ratio at 15.46 percent, while insurers’ average comprehensive solvency adequacy ratio was 181.1 percent. State-owned big banks were recapitalized by RMB 520 billion last year, and eight central financial enterprises recently received an additional RMB 360 billion injection.

Capital Market Ambitions

CSRC Vice Chairman Li Chao outlined eight priorities for the capital market, aiming to “basically form a new pattern of high-quality capital market development by 2030, the 40th anniversary of the capital market’s establishment.” He said the CSRC would work to make the A-share market the “preferred listing destination for high-quality domestic enterprises.”

Li cited several data points: since the start of 2026, social security, annuity, and insurance funds — known as medium- and long-term funds — net-bought more than RMB 600 billion of A-shares, with their held circulating market value rising 12.5 percent versus the end of 2025. In the first eight months of the year, 644 securities and futures violations were investigated, with nearly RMB 10 billion in fines and confiscations. Since 2024, 108 companies have delisted smoothly, while tech innovation firms accounted for over 90 percent of new listings. Since the “Nine National Articles” policy, listed companies’ cumulative dividends and buybacks have exceeded RMB 7 trillion.

Outlook on the Balance of Payments

SAFE Spokesperson and Deputy Administrator Li Bin said China would deepen foreign exchange management reform to build a “more convenient, more open, safer, and smarter” system. He predicted that during the 15th Five-Year Plan period, China’s balance of payments would show “scale increase, structure optimization, and overall balance,” with exports and imports developing more coordinately.

Analysis and Implications

The plan marks a formalization of the “financial powerhouse” concept, which was elevated to a top national priority at the Central Financial Work Conference in late October 2023. According to a Xinhua report, the phrase was written into a Five-Year Plan recommendation for the first time in October 2025 — a milestone that underscores how central financial strength has become to Beijing’s long-term strategy.

China already possesses the world’s largest banking system, the second-largest insurance, stock, and bond markets, and the world’s largest foreign exchange reserves. Yet officials and economists have long acknowledged that the system remains “big but not strong,” with structural imbalances and immature market mechanisms relative to China’s standing as the world’s second-largest economy. The shift toward interest-rate-based monetary policy tools and the emphasis on raising the share of direct financing both signal an intent to address those structural weaknesses.

For global markets, the plan’s emphasis on RMB internationalization, offshore RMB market development, and the ongoing opening of China’s financial markets suggests continued, if measured, integration with the global financial system. At the same time, the regulators’ language on risk prevention and “toothy” supervision signals that Beijing intends to keep a firm hand on stability.

What’s Next

The release of the plan is the start of a multi-year implementation effort. The PBOC’s nine supporting action plans, the CSRC’s pending regulatory revisions — including the revised Securities Company Supervision Regulations expected soon — and the NFRA’s work on local institution risk will be key markers to watch in the coming months. Also in focus: the rollout of the digital RMB, the pace of RMB internationalization, and whether the shift toward price-based monetary policy tools translates into tangible changes in how the central bank manages liquidity and guides interest rates.