The Strength of Commercial Banks Depends on That of Its Board of Directors

2007-11-8

　　As to the reform concerning the system of business departments carried out these two or three years, the purpose is to make us more specialized. For example, we can now participate in projects like wind power, small hydroelectricity and environmentally protective power generation by burning grain stalks. All of them are very profitable but also very specialized. Why we dare not do these in the past is that we had no specialized teams, and now we specially deployed a number of specialists from the power industry. However, I am operating risks, that is to say, income from a project shall be 1+n: 1 is interest margin, n is all sorts of intermediate costs, including financial consultancy fee, advisory fee, etc.

　　CMBC will establish a totally new financial service system in eight industries, which will also change the old situation where Chinese banking industry takes interest margin as main operating income.

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