The China-initiated Asian Infrastructure Investment Bank (AIIB), a complement to existing international financial system, was officially established Friday in Beijing and expected to start operation early next year, a top finance official announced.

"The AIIB is legally established as the Articles of Agreement take effect today," said Lou Jiwei, China's Minister of Finance.

The Articles of Agreement outlines the financial share of each founding member as well as rules for policymaking, governance structure, and business and operational systems for the bank.

It became effective once the legislatures of 17 members, who hold a combined 50.1 percent stake in the bank, ratified the agreement.

As long as at least 10 signatories, and no less than 50 percent of the capital contribution, obtain legislative approval, the agreement will become effective.

The establishment of the AIIB marks a milestone in the reform of global economic governance system, Lou said.

The AIIB will be operational after board of directors and executive council meet for the first time, said Lou, adding that the meetings are slated to run from January 16 to 18 in Beijing.