The central bank of the People's Republic of China is the People's Bank of China. According to the applied provisions in the Law of the People's Republic of China on the People's Bank of China, the People's Bank of China (PBOC) shall, under the leadership of the State Council of the People's Republic of China, formulate and implement the monetary policy, and carry out the supervision and administration of China's financial industry. Evidently, the central bank is one of the State's departments.

According to the applied provisions in the Law of the People's Republic of China on Commercial Banks, commercial banks are business corporations incorporated under China's Law for Commercial Banks and Company Law, and engage in businesses of attracting deposits from the public, granting loan facilities, and conducting accounting settlements.

The key differences between the central bank and commercial banks are:

(1) The central bank is one of the State's departments, whereas commercial banks are business corporations;

(2) The central bank is one of the State's functional departments to formulate and implement the monetary policy under the leadership of China's State Council, whereas commercial banks are business corporations operating businesses of attracting deposits, grating loan facilities and conducting accounting settlements;

(3) The central bank is to administer commercial banks and other institutions in the financial sector, whereas commercial banks are subjects to be administered; and

(4) The president candidate of the central bank shall be subject to nomination by China's Premier of the State Council, adoption in China's National People's Congress (NPC) or the Standing Committee of the NPC, and appointment and dismissal made by China's President, whereas the establishment of the institutional framework of commercial banks shall be subject to China's Law for Commercial Banks and Company Law.