Speaking at an annual forum in Shanghai, Zhou focused on broad reforms and competition, but did not discuss more immediately pressing policy challenges like managing the yuan exchange rate or balancing efforts to "de-leverage" the economy and encourage growth.

Zhou said some people keen to limit foreign participation in the financial sector were "focused on their own interests" and not doing Chinese financial institutions any favors.

"From the experience of many countries, including our own, protections will lead to laziness and weakness... protectionism will lead to weak competitiveness and will hurt the industry's development, and (make for) unhealthy and unstable markets and institutions," he said.

The financial services industry had benefited from opening up, and must continue to do so, he said at the start of the Lujiazui Forum in China's finance hub.

While the government has opened parts of the financial sector to foreign participation, non-Chinese firms still face a range of restrictions on both investment and business.

Analysts say the risks to China's financial sector and the broader economy have grown as debt has soared.

Maintaining healthy financial institutions was key to defending against a financial sector crisis, Zhou said.

As part of efforts to lift the yuan's status as a globally significant currency, China's long-planned international payment system for cross-border yuan settlement would "soon" be based in Shanghai, Zhou said.

The China International Payments System, or CIPS, would replace a patchwork of networks and allow hassle-free yuan payments.

China has been keen to turn the yuan into a global currency, but its efforts have been stymied by a string of capital control measures aimed at easing depreciation pressure in recent months.

The yuan lost about 6.5 percent of its value against the dollar last year and economists had expected further depreciation this year, but capital controls, a weaker dollar and other steps by the authorities have bolstered the value of the Chinese currency.