The National Business Daily, a financial newspaper founded in 2004 and based in Shanghai, has reported that the China Banking Regulatory Commission is to conduct a series of checks all over China that will look at payment guarantees at wealth management firms.

This so-called "nationwide health check" for the banking sector will cover not only wealth management but also bills, deposits and lending in general. It will also go beyond the banking sector and target trust companies.

According to some press reports from this opaque jurisdiction, three of the four main financial regulators (the China Banking Regulatory Commission or CBRC, the China Securities Regulatory Commission or CSRC and the China Insurance Regulatory Commission or CIRC) are moving toward closer co-operation because wealth management firms are conducting regulatory arbitrage between them. The wealth sector reportedly accounts for 24.6 trillion yuan (US$3.7 trillion). Wealth managers in China are suspected of investing their customers' money in excessively 'leveraged' stocks in a way that makes markets more volatile.