. risk control has increasingly become the core of financial sector performance as a result of the increasing complexity of financial businesses and products, yet not all people have realized it. in china, many financial institutions have begun to pay attention to risk control only in recent years. thus, risk control is rather weak. in many large financial institutions abroad, risk control department is very important and powerful, so much as that the risk control officer is in a position to reject what the president has said. therefore, when we explore cross - sector operation and new cross - sector products, importance should be attached, first and foremost, to talents and risk control. otherwise, problems of one kind or another might emerge in the piloting operation. problems are not bad things for experience could be accumulated in the process. but problems in the financial sector usually will slow down the reform and experiments. iv. in the steady progress of cross - sector operation, not all financial institutions will adopt the pattern of cross - sector operation. every financial institution has its own development strategy and features, and needs to consider how to position itself in the market, on the basis of the specificities of its clients and what kind of services to provide to such clients. in many countries, after the restrictions of segmented operation were lifted, especially after the bank reform act was adopted to lift control in 1999 in the u. s., not all financial institutions rushed to expand their business into other sectors. decisions on whether to conduct crosssector business or continue to focus on some businesses should be made by a financial institution after careful deliberation, based on its strength, development strategy and the specific characters of operation. v. central bank and regulatory authorities face challenges in the piloting cross - sector operation. first of all, the quality of supervisors should be improved. they need to have knowledge of all kinds of financial businesses. of course, this will take some time. second, given the framework of segmented supervision, coordination among the three regulatory agencies should be strengthened, and functional supervision stressed. the agency who gives license to financial institutions should not be the one to approve all the businesses of all financial institutions. rather, financial institutions should be supervised according to the type of their businesses. many new issues relating to functional supervision should be studied. as for the role of central bank, through its payment and settlement system, it provides a platform for various kinds of financial activities ; on the other hand, because contagious risks usually come from deposit taking institutions,

gongsheng pan : situation and development of china's foreign exchange market speech by mr gongsheng pan, deputy governor of the people's bank of china, at the 13th lujiazui forum, shanghai, 10 june 2021. * * * honorable secretary li qiang, mayor gong zheng, governor yi gang, chairman guo shuqing, chairman yi huiman, ladies and gentlemen, good morning. at today's forum, i would like to talk about the situation and development of china's foreign exchange market. i. the rmb exchange rate has seen two - way fluctuations and the foreign exchange market operates stably 1. the operation of the foreign exchange market is a subject of common concern. since the beginning of this year, the rmb exchange rate against the us dollar has seen twoway fluctuations and is generally stable. developments in international financial markets, especially the fluctuations in the interest rate and the exchange rate of the us dollar, have had some impact on other currencies, including the rmb. at the same time, with the chinese economy continuing to recover steadily, the rmb exchange rate has remained basically stable at an adaptive and equilibrium level. at present, china's current account surplus remains in a reasonable range ; supply and demand in china's foreign exchange market are basically in equilibrium ; and china's foreign exchange reserves are stable and rising. china adopts a managed floating exchange rate regime based on market supply and demand with reference to a basket of currencies. it has proved to be an institutional arrangement suitable to china's national conditions and will be pursued persistently. 2. factors influencing the rmb exchange rate are complicated and two - way fluctuations will become normal. the rmb exchange rate is more stable than other currency exchange rates ; rmb exchange rate expectations are stable ; and trading in china's foreign exchange market has been rational and orderly. there are multiple factors home and abroad that influence the movements of the rmb exchange rate. on the one hand, china's economy has been stable and improving ; it has maintained a normal monetary policy ; its balance of payments is sound and stable ; and its foreign exchange market is maturing. all these factors will continue to provide strong support for the stability of the rmb exchange rate. on the other hand, there are 1 / 5 bis - central bankers'speeches a number of destabilizing factors and uncertainties in the external environment affecting the rmb exchange rate. first