There has been much talk in the local media about restructuring dividends. What the commentators failed to note is that the dividends will not be distributed evenly to all companies.

Take the banking sector for example. The progressive decontrol of interest rates and some banking businesses should promote competition and efficiency, leading to a stronger banking sector. But the resulting increase in competition could create problems for some banks that have for years enjoyed a guaranteed profit by the wide spread in the official lending and deposit rates. Many executives running these banks have neither the will nor the foresight to explore new ways to make money by business acumens rather than political influence.

A friend used to complain that her bank charged her a hefty fee for transferring money from her account to that of her parents' in another city. Now, she is using a newly established Internet platform to make the transfer at zero cost and with minimum hassle.

Many banks have claimed that they have successfully diversified their income stream through asset restructuring. But what they have done is simply package loans into what they call wealth management products which they sell to investors through a variety of channels. This has given rise to the unregulated and opaque world of shadow banking that has been a subject of much concern to many economists.

Obviously not all banks can be considered concept stocks despite all the talk about speeding up financial reform. Too many investors are still hunting for their idea of the perfect concept stock by looking for policy favors. Perhaps if they try to bring themselves more up to date, they would realize that times have changed and stop dreaming about the next big policy initiative that will boost stock prices.

The author is a senior editor with China Daily. Jamesleung@chinadaily.com.cn

(China Daily 12/02/2013 page8)