According to Shang Fulin, chairman of the China Banking Regulatory Commission, the commission had approved the founding of five private banks by March, and it is now processing more than 40 applications from 20 provinces, among which about 10 applications will be approved.

In the first quarter, the Chinese economy grew 7 percent year-on-year, the registered unemployment rate was 5.1 percent, and people's income grew at 8.1 percent.

But industry's profit dropped 4.2 percent and imports fell 17.3 percent.

In the meeting, Li shared his views on the banking industry's role during the transitional stage of the economy.

"The real economy is like the body, and the finance sector is like the blood. The problem with the Chinese finance sector is not anemia, but poor circulation of the blood," he said.

The banks should make good use of their funds through more reforms and innovations based on the Internet and by increasing the finance services' efficiency in supporting infrastructure construction, Li said.

He said he strongly supported a suggestion from Liu Shiyu, president of the Agricultural Bank of China, that the government should lower taxes on imported large-scale agricultural machinery for agricultural financial leasing companies. The premier urged the ABC to strengthen its financial services for grassroots farmers.

"There should be more banks appearing in the rural financial market to create reasonable competition and let the farmers have more options," Li said.