The banking sector remains largely healthy, and market-oriented reform will be continued prudently, finance officials said.

People's Bank of China Governor Zhou Xiaochuan (center) responds to a reporter's question at the media center of the 18th National Congress of Communist Party of China on Sunday. [Zou Hong/China Daily]

Banks are also seeking opportunities to further expand business overseas as the yuan increasingly becomes a global currency.

"The banking system's risk is under control and the non-performing loan ratio, 0.97 percent, is low," Shang Fulin, chairman of the China Banking Regulatory Commission, said at a news conference on Sunday during the 18th National Congress of the Communist Party of China.

Bank lending is not concentrated on any high-risk investment projects, and most of the loans have mortgage guarantees, Shang said.

Sound earnings and the prevention of risk is the basis for domestic banks, he said.

Total debts will rise from 191 percent of GDP at the end of 2011 to 206 percent by the end of this year, according to a report by Standard Chartered Bank.

The report also said that the country will have public debt at 58 percent of GDP by the end of 2012.

Consumer debt will stand at 19 percent of GDP, and corporate debt at 128 percent.

Zhou Xiaochuan, governor of the People's Bank of China, urged alertness to potential risks, especially shadow banking, as banks diversify financial products and services.

Shadow banking, as the name suggests, mainly refers to credit access outside the regular system. In China, it usually involves wealth management products, underground finance and off-balance-sheet lending.