As reported in a statement from the People’s Bank of China on Monday, the United States and China have finalized agreements to cooperate on financial stability last week.
The agreement was reached during a meeting of the U.S.-China Financial Working Group held in Shanghai on Thursday and Friday, with the authorities leading the group being Brent Neiman, the deputy under secretary for international finance at the Treasury Department, and Xuan Changneng, the deputy governor of the PBOC.
Key points discussed during the meeting included the exchange of contact lists for handling financial stress or risk events, as outlined in the PBOC statement.
While a Treasury statement was not yet available as of early Monday, representatives from various institutions such as the Federal Reserve, U.S. Securities and Exchange Commission, National Financial Regulatory Administration, and China Securities Regulatory Commission were in attendance according to the PBOC.
The discussions were characterized as “professional, pragmatic, candid and constructive,” and covered topics like capital markets, cross-border payments, and the monetary policies of both countries – with a focus on China’s recent Third Plenum meeting.
Technical experts presented reports on globally significant banks, operational resilience of financial institutions, and stress testing for climate risks.
Recent volatility in China’s government bond market was also addressed, following reports of intervention by the PBOC earlier this month. Central bank governor Pan Gongsheng highlighted on Thursday, through state media, that China’s financial risks have decreased, particularly in relation to local government debt.
Additionally, U.S. and Chinese financial institutions convened for their inaugural roundtable meeting under the working group’s framework, discussing potential cooperation opportunities and the role of finance in promoting sustainable growth.
The economic and financial working groups were initiated by U.S. Treasury Secretary Janet Yellen and Chinese Vice Premier He Lifeng in September 2023. These groups facilitate regular meetings at the vice minister level between Treasury officials and the Ministry of Finance as well as the PBOC.
