By Li Hongmei

China's banking regulator will approve up to five private banks this year under a trial to allow private funds to invest in the sector as the country seeks to further liberalize the financial industry in a bid to bolster its slowing economy.

The China Banking Regulatory Commission said it plans to broaden the channels and means for private capital to invest in the banking sector, according to a statement posted on its official website yesterday.

Private capital will be encouraged to participate in the restructuring of the banking industry. They will also be allowed to set up banks at their own risks under the trial, the CBRC said.

About three to five private banks will be approved in the first batch on a case-by-case basis, the CBRC said.

The regulator will explore measures to gradually lower market entry and capital requirement for additional branches for foreign banks.

The CBRC also said it will further support banking reforms in the Shanghai pilot free trade zone.

The CBRC's tasks for 2014 include preventing systemic and regional risks, controlling local government financing platforms, managing credit risks of property loans and loans to industries with excess capacity.