Aligned with the demographic dividend characterized by high savings, high investment and high economic growth, China’s financial system has evolved three key features after more than 30 years of development: (1) In terms of financial resource allocation, it is a constrained financial system in which the government plays a dominant role; (2) In terms of savings channels and investment channels, it is a bank-oriented system in which the (traditional) banking sector plays a major role; (3) In terms of the opening-up level of the financial system, China’s financial system is still relatively closed. This financial system not only fails to adapt to the requirements of the “new normal” of the economy, but also is causing potential systemic risks. It can be seen that China’s leverage level has reached or even exceeded those of the countries involved in the European sovereign debt crisis, and China’s leverage level has continued to rise in 2016.