China has given its fifth-largest bank the green light to pursue a market-based reform plan as Beijing seeks to improve efficiency at state-owned companies — but privatisation will play only a limited role.

Shanghai-based Bank of Communications has long been used as a test case for reforms later introduced throughout the state-dominated banking sector. In 2005 it became the first Chinese bank to list overseas when it debuted in Hong Kong.

While Bocom will sell minority stakes to private investors, this will be only a small part of the lender’s broader reform plan, according to a filing late on Tuesday, the latest sign that the Communist party has no intention of relinquishing control of “strategic sectors” such as finance, energy and telecommunications.