Chinese Premier Wen Jiabao has ordered state-owned China Construction Bank and Bank of China to ensure they meet reform targets meant to transform them into true commercial institutions within three years, reports said Wednesday.
"The two banks should be transformed into modern joint-stock commercial banks with international competitiveness within the coming three-year period," the official Xinhua news agency quoted Wen as saying.
"Banks covered by the reform and relevant departments must realise that the reform is necessary, complicated and difficult," Wen said at a State Council meeting.
Last December the government again bailed out debt-ridden banks, giving Bank of China and Construction Bank 22.5 billion dollars each from the country's foreign exchange reserves to bolster their balance sheets in preparation for a stock-market listing.
An initial public offering (IPO) is part of government efforts to make the banks commercially viable.
Industrial and Commercial Bank of China (ICBC), the country's largest state commercial lender, is expected to receive a cash injection of 40 billion dollars while China Agricultural Bank, the fourth and most troubled of China's "big four" commercial lenders, is likely to receive a similar sum.
As part of the package, the banks were each given targets of turning themselves into profitable operations that could compete against the army of international lenders set to enter China by end of 2006 as called for under World Trade Organisation agreements.
Some of the reform goals have been criticised by Wen himself after China Construction Bank announced it would launch an IPO later this year.
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