Chinese regulator opens market access for foreign banks
The China Banking and Insurance Regulatory Commission (CIRBC) has released a series of new rules and amendments giving foreign lenders and financial firms easier access to the Chinese market.
Following a period surveying the industry, the regulator has published new measures which cancel the total asset requirement for foreign banks aiming to set up in China.
It will also relax limits on shareholders of joint ventures in the country.
Foreign banks will now be able to open both branches and wholly owned banks in the country.
The aim of these changes is to promote decentralisation and simplify administration, the agency writes on its website, as well as optimise the business environment in China.
In line with these changes are a series of tightened requirements around equity management, anti-terrorist financing and anti-money laundering (AML).
The CIRBC writes that it hopes the measures will enable an increase in the opening-up of China to foreign investment and overseas lenders and promote socio-economic development.
It adds that it will insist on “equal emphasis” on this opening out and on proper supervision of all banking entities.
The news comes amidst a wider opening up of Chinese markets to foreign companies, investors, and technology firms.
Back in October 2019 the China Securities Regulatory Commission (CSRC) revealed that it would be abolishing foreign ownership restrictions on futures, securities, and fund management companies.
That same month PayPal became the first foreign company to gain a Chinese payments licence, following the acquisition of local firm Guofubao.
The People’s Bank of China (PBOC), China’s central bank, has previously pledged to give equal treatment to foreign companies seeking to ply their trade within the country.
The central bank must decide on applications for a licence within 90 days, according to its own rules. Despite this, companies like Visa and Mastercard have been waiting for a licence for years.