By welcoming more private capital, officials are hoping to inject competition and innovation into China’s sclerotic banking sector. The aim is these new bank to target and medium-sized enterprises, long starved of capital by the state-run banks (keener to lend to stateowned enterprises). Two giant Chinese internet firms, Tencent and Alibaba, are among the chosen investors. That suggests the authorities are taking a favourable view of the forays the two firms have made into internet finance.