79th Congregation (2015)
Professor LIU Mingkang
Amidst the ever-turbulent waves of the financial market, he applies his expertise to surf above the risks. Amidst a busy, ever-changing world, he applies his paintbrush to record life’s vicissitudes.
With the rise of its economy, China is now making a massive impact on the international stage. The banking sector, financial management industry and stock market have all played a significant role in establishing the country as an economic powerhouse. However, just as we need reins and stirrups to direct a galloping horse and ensure a swift but steady ride, so does China need effective tools and rules to control, supervise and regulate its rapidly developing economy, to ensure that it achieves its goals and wins global attention and acclaim.
As China’s economy has moved ahead at full throttle, Professor Liu Mingkang has been one of its skilled leaders. Not only has he been the head trainer of its banking system, he has even been called the father of China’s banking regulatory system. In 1994, he transferred from Fujian to Beijing when he was named Deputy Governor of the China Development Bank. In 1998, he was appointed Deputy Governor of the People’s Bank of China and, in 2000, he took the helm of China’s banking sector, becoming Chairman of the Board of Directors and President of the Bank of China (BOC), where he began his bold reform of China’s banking system. The following year saw him named as one of the ‘Asian Stars’ by Asiaweek. Then in November, he received an honorary doctorate from his alma mater, City University London. In 2003, he was named the first Chairman of the China Banking Regulatory Commission (CBRC). Since then, he has also served as a senior fellow of the Hong Kong Institute of Bankers, and was a member of the Governance Body of the Basel Committee on Banking Supervision, a director of the Board of the International Centre for Leadership in Finance of Bank Negara Malaysia, and Vice Chairman of the International Institute of Finance. Professor Liu has been an invitee of the ASPEN Institute, Group of Thirty, and many other important economic and financial forums.
A native of Fuzhou, Fujian province, Professor Liu was born in Shanghai in 1946. In 1987, he received his MBA from City University London. In 1988, he became Vice President of BOC Fuzhou municipal branch, then President of the BOC Fujian provincial branch. Later he served various key positions, such as Vice Governor of Fujian province and Secretary-General of the Fujian provincial government, Deputy Governor of the China Development Bank, and Deputy Governor of the People’s Bank of China. In 1999, he became the Chairman of China Everbright Group, in which he demonstrated only a small part of his talent by improving the financial structure and internal risk management of the company.
When Professor Liu assumed the mantle of President of the BOC, he began to demonstrate his true leadership and financial prowess. He initiated drastic reforms through organisational re-engineering to enhance corporate governance and tackle deep-rooted malpractice, establishing systems for sound decision-making and risk assessment, and effectively preventing moral hazards in credit decision-making, asset disposal and bulk procurement. He also masterminded the restructuring of 12 BOC Hong Kong’s subsidiary banks, culminating in the bank’s initial public offering in the Hong Kong Exchanges and Clearing Limited –– the first public listing of any of China’s state-owned banks. The next year, Professor Liu pushed forward further reform and opening up of the Chinese banking industry at the newly established CBRC to rescue the so called ‘technically bankrupt’ banking industry, which had been plagued by bad debts. Just within a few years, Professor Liu brought in 44 foreign banks as partners, and assisted 33 banks in mainland China to reform. Under his leadership, the CBRC set up an international consultation committee comprised of world-renowned financial experts, introduced foreign regulations, and learned through the experiences of other countries. Through measures such as state fund injection, the disposal of non-performing assets, the establishment of limited companies, the introduction of strategic investors, and timely public listings, the CBRC created a comprehensive and effective regulatory system, which helped strengthen China’s banking industry against international financial crises. In 2009, the CBRC and Professor Liu himself were jointly presented with the ‘2009 Risk Manager of the Year Award’ by the Global Association of Risk Professionals. He was honoured with the Lifetime Achievement Award by The Asian Banker in 2012.
Professor Liu believes it is important for the financial market to have a self-functioning system, stressing the timeliness, validity, accountability and stability of national policies. He has advocated a separation of monetary and fiscal affairs to boost the openness of government debts and minimise risks and potential hazards. He believes that China should establish a better loan culture through reforming the approval standards of loan information and enhancing transparency. He has put forward the liberalisation of foreign exchange and capital accounts to strengthen the flow of international capital and trade.
In 2011, Professor Liu retired from his eight-year tenure at the CBRC to teach and train at universities. He now sits on the International Advisory Boards of the management schools at both Peking University and Tsinghua University. He is an Honorary Dean of the Lingnan (University) College of Sun Yat-Sen University and an Honorary Professor of CUHK’s Business School, as well as BCT Distinguished Research Fellow of CUHK’s Institute of Global Economics and Finance (IGEF).
Despite his career’s ever-changing, highly stressful environment, Professor Liu maintains a calm, relaxed lifestyle. Well-versed in the arts, calligraphy and classical music, he finds tranquillity through painting, applying his brush to capturing both landscapes and social happenings in his leisure time. Some of his paintings were exhibited in S.H. Ho College at CUHK in 2014, winning good reviews from experts, teachers and students. Professor Liu once said, ‘Life is like a painting. Sometimes dark, sometimes light, sometimes wet, and sometimes dry ... What’s important is to retain a sense of childlike innocence, to stay grounded despite the world's constant changes, and to do your best to discover truth and sincerity in life.’ He certainly hit the nail on the head.
In recognition of his outstanding achievements in the development of China’s banking industry and financial regulatory system, as well as his contributions to the CUHK’s Business School and IGEF, Mr Vice-Chancellor, I have the great honour of presenting to you Professor Liu Mingkang for the award of the degree of Doctor of Social Science honoris causa.