Financial Stability and Development Committee of the State Council (the "Financial Committee'' for short below) held the ninth meeting and researched on the issues involving deepening the reform of medium and small banks, forestalling and defusing financial risks, etc., mentioning the necessities to strength the reform of the basic systems of the capital market, fully leverage the pathfinding role of the investment funds and venture capital funds of various industries, and better meet the financing needs of enterprises committed to scientific and technological innovation. 

The top 10 key statements: 

1. Attach great importance to the construction of a modern central bank system, advance the development of the basic systems of the capital market, and improve the modern financial system featuring high adaptability, competitiveness and inclusiveness. 

2. Make constant efforts in significant areas, including deepening the SOEs reform, supporting the development of small and medium-sized enterprises, establishing a system of punitive compensation for intellectual property infringements, refining the favorable law environment for the private economy and foreign-invested enterprises, and improving the systems and mechanisms for scientific and technological innovation. 

3. Make concerted efforts to ensure the "Six Stability" Initiative: the stability in employment, financial industry, foreign trade, foreign investment, domestic investment, and expectations, forestall and defuse various risks, and keep the main economic indicators within an appropriate range. 

4. Efforts should be made to deepen the reform of small and medium-sized banks, improve the corporate governance structure and risk internal control system fitting the characteristics of these banks, and cope with the root causes of systems and mechanisms for the development of these banks. 

5. Consolidate the primary responsibility of financial institutions, the territorial responsibility of local governments, and the regulatory responsibility of financial management departments, improve the market environment and supporting policies for the banks in replenishing capital, and build sustainable systems and mechanisms for capital replenishment. 

6. Fully combine strengthening the top-level design with inspiring internal force, pay attention to the specific division of labor between the central and local, and between the government and market, rationalize the incentive mechanism, and keep all the parts fully motivated. 

7. Currently, lay emphasis on supporting small and medium-sized banks in replenishing capital through multiple channels, optimize capital structure, and enhance their abilities to serve the real economy and resist risks. Pay attention to the promotion of conductive experience and practices in the operation and management of small and medium-sized banks, and improve the business models of medium and small banks. 

8. Refine the financial policies and measures in favor of scientific and technological innovation, optimize financing methods for scientific and technological innovation, and improve the supporting policy environment. 

9. Adhere to the principles of marketization and rule by law, give full play to the driving role of the investment funds of various industries and venture capital funds, and better meet the financing needs of enterprises with scientific and technological innovation. 

10. Strengthen the holistic supervision and construction planning of the financial infrastructure, promote the interconnection of all kinds of financial infrastructures, and ensure their security and efficiency. 

Source | Securities in China