China's asset custody industry developed rapidly in 2013 as banks sought a new growth engine during the process of interest rate liberalization, the China Banking Association said on Monday.

People's Bank of China Governor Zhou Xiaochuan reiterated on July 10 that China is likely to have fully liberalized interest rates within two years.

As a result, domestic banks will have to develop intermediary businesses, such as asset custody services, to make a profit, rather than relying heavily on interest rate margins.