The People's Bank of China, the central bank, pledged to step up prevention of financial risks to ensure stable and sound development of the country's financial system in 2009.

The central bank said in a report released Friday that the financial industry "is facing new challenges" this year and should seek to strengthen protection against risks and increase its competitiveness.

It also urged the financial industry to contribute more to the national economy. Supervision should be improved and financial innovation would be encouraged, said the report.