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    China Business
     Sep 13, 2005
Local deposit limit on foreign banks may ease

BEIJING - The China Banking Regulatory Commission (CBRC) recently issued a research report, saying that in order to match changes in the macroeconomic and financial environment, the CBRC is considering revision or even cancellation of the quantity limit on foreign-capitalized banks in accepting deposits in China. The report is titled "Conscientiously implementing the ideology of scientific development and steadily pushing forward the opening of China's banking industry to the outside world".

According to the revised Administrative Regulations on Foreign Capital Financial Institutions, promulgated in 2001, the amount of deposits taken in the Chinese territory by a foreign-capitalized financial organization should not exceed 70% of its total assets.

 

A revision of this stipulation is under consideration, the report says. According to the report, the supervision authorities will also urge overseas strategic investors to play functions in improving the corporate governance of Chinese banks. The report adds that the CBRC will encourage cooperation between Chinese and foreign-capitalized banks in financial innovations.

In the aspect of market access, the CBRC will give full consideration to the participation and role of foreign-capitalized banks. For instance, when commercial banks apply for the establishment of fund management companies, priority in approval will be given to the cases involving participation of qualified foreign-capitalized banks.

Aside from emerging services, there is also big room for further cooperation between Chinese and foreign banks in traditional business fields. For example, in making syndicate loans, they may give play to their respective advantages in capital and technology, and in the yuan-clearing business, foreign banks may take advantage of the networks of Chinese banks.

(Asia Pulse/XIC)

 

 
 



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