The PBOC has already started asking institutions to report their off balance sheet operations as early as October. One central bank's official told the press how they will implement such a mechanism.

The People's Bank of China will include off balance sheet wealth management products in macro-prudential assessments starting in the first quarter of 2017. That action would potentially require banks to put aside more capital. The calculation will exclude more liquid assets such as cash and deposits.

The central bank warned that even though the new assessment is only set to take effect in the first quarter of 2017, financial institutions should not rush to hike their off balance sheet operations before year's end. That's because such operations will shore up credit volume, which will be shown in next year's assessment.

The bank also said that China's macro-prudential assessments have worked well for the past year since they were launched. However, the authority has noticed a jump in off balance sheet operations. Those wealth management products mostly consist of credits and bond investments. The bank says many of them are perceived to have implicit return guarantees from banks. Hence they SHOULD be subjected to tighter oversight if China wants to lower leverage in its financial system.