China will privatize the Bank of China (BOC) and China Construction Bank (CCB) within the next three years, said China Banking Regulatory Commission (CBRC) Chairman Liu Mingkang here Thursday.

Addressing the Eighth China International Fair for Investment and Trade in Xiamen, east China's Fujian province, Liu recalled the CBRC has advocated state bank reform since 2003.

Liu acknowledged that the two banks have been chosen as pilot banks for the reform of China's banking system and that they will be joint-stock companies by the end of 2006.

The CBRC will aid reform by pooling advanced experience from overseas in management structures, the official acknowledged.

By then, the reformed banks will boast sufficient capital with safe operational modes and first class services, he said.

The CBRC will also speed up the reform in the Industrial and Commercial Bank of China and Agricultural Bank of China.

By the end of 2004, the four state banks will hold 16.1 trillion yuan (approximately 1.93 trillion US dollars), accountingfor 54.1 percent of China's total.

The stable management and healthy development of the state banks will be of great importance to China's sustainable economic growth, Liu said.