As they let financial firms experiment, China’s various regulatory agencies failed to coordinate. The International Monetary Fund highlighted gray areas in regulation as a medium-term economic risk in a mid-2016 report that described “the increasingly large, opaque and interconnected financial sector.” The back-to-basics push is meant to neutralize chances a financial flare-up could detract from the Communist Party’s once-in-five-years leadership conclave expected late this year, when President Xi Jinping needs support to increase his power. “This is completely defensive,” says Anthony Neoh, a longtime adviser to Chinese financial policy makers and a board member of giant Industrial and Commercial Bank of China Ltd. “Markets have a way of running away from governments all the time.”

https://www.wsj.com/articles/china-shakes-up-regulators-in-scramble-for-stability-1492678390