This year (2007) is not only the first year after the expiration of five-year transitional period of China 's admittance into WTO, but also the year of inaugurating the national treatment of both local and foreign banks in China . The banking sector in Liaoning Province is encountering dual challenges both from adjusting itself to the changes from the Northeast Economic Revitalization Project and also from the banking reforms during the post-WTO transitional period compounded by the commencement of national treatment to foreign banks. This signifies that Liaoning banking sector is enduring combined risks of both the existing and the incoming. The purpose of this article is to analyse Chinese banking sector's dilemma and challenges in the wake of opening banking market by taking Liaoning banks as an example in an attempt to search for a coping strategy.