In one widely publicized case last summer, a government audit uncovered financial crimes and bookkeeping irregularities totaling 52 billion yuan ($6.45 billion) at the state-owned Agricultural Bank of China, the country's second-largest bank in terms of assets.

With losses that big, it's no wonder Chinese banks are investing heavily in risk management technology. For example, Agricultural Bank of China last year rolled out a new real-time monitoring system to reduce fraud.

But adopting technology for risk management and fraud control is only part of the Chinese banking industry's agenda. Banks are centralizing operations, improving financial reporting, automating manual processes, improving customer service and developing new products to compete in an expanding marketplace.

And like their counterparts in the U.S., many are feeling the pinch of new regulations. IT is at the heart of all this activity, and the scale and speed at which the Chinese banking industry is ramping up may be unprecedented.

"The scale is tremendous," says Elias Baltassis, director at the Paris office of New York-based consulting firm Opera Solutions LLC. Moreover, Chinese banks have to upgrade all their systems at once because they are behind in every area. "This is a problem U.S. banks never had," Baltassis says.