Notice from the CBRC on Banking Regulation in China (Shanghai) Pilot Free Trade Area

Yin Jian Fa2013No.40


CBRC local offices, policy banks, state-owned commercial banks, joint-stock commercial banks, financial asset management companies, postal savings bank, and trust companies, finance companies of corporate groups, and financial leasing companies directly under the supervision of the CBRC: 


Recently, the CPC Central Committee and State Council have decided to establish China (Shanghai) Pilot Free Trade Area (FTA). With the approval from the State Council, the CBRC issued the following notice concerning banking regulation in the FTA.


1. Support the development of Chinese banks in the FTA. Chinese commercial banks, policy banks and Shanghai local banks can set up branches or specialized institutions in the FTA. Existing outlets in the FTA can be upgraded to branches or sub-branches. The newly added or upgraded institutions in the FTA will not be limited by the annual plan for newly added outlets.


2. Support the establishment of non-bank financial institutions in the FTA. Support qualified large corporate groups to set up finance companies in the FTA; support qualified initiators to set up automobile financial companies and consumer finance companies in the FTA; support trust companies in Shanghai to move into the FTA; support national financial asset management companies to set up branches in the FTA; support financial leasing companies to set up subsidiaries in the FTA.   


3. Support the development of foreign banks in the FTA. Qualified foreign banks can set up subsidiaries, branches, specialized institutions and Sino-foreign joint-venture banks in the FTA. The sub-branches of foreign banks in the FTA can be upgraded to branches. Research will be conducted on properly shortening the period for representative offices of foreign banks to upgrade to branches and the period for foreign banks to conduct RMB businesses.


4. Support private capital to enter the banking sector in the FTA. Support qualified private capital to set up private-owned banks, financial leasing companies, consumer finance companies and other financial institutions at their own risks in the FTA. Support qualified private capital to take share in establishing Sino-foreign joint-venture banks with Chinese or foreign financial institutions in the FTA.


5. Encourage cross-border investment and financing services. Support banking institutions in the FTA to develop cross-border financing services, including but not limited to: commodity trade financing, supply chain trade financing, offshore shipping financing, modern service sector financial support, domestic loans under overseas guarantee, commercial paper, etc. Support banking institutions in the FTA to carry out cross-border financial services, including but not limited to: cross-border M&A loans, project loans, overseas loans under domestic guarantee, cross-border asset management and wealth management, real estate trust and investment funds, etc.


6. Support the development of offshore business in the FTA. Qualified Chinese-funded banks can conduct offshore banking business in the FTA.


7. Simplify access procedure. For banking institutions under the branch level (branch excluded)in the FTA, the access procedure for institutions, senior managerial staff, and certain businesses are changed from prior approval to after reporting system. A green and fast access channel for the banking sector will be established in the FTA and a related time limit mechanism will be set up, so as to improve access efficiency.


8. Improve regulatory service system. Support and explore to establish a relatively independent banking regulatory system that is in line with the situation in FTA, so as to provide market-oriented regulatory services and effectively control and prevent risks. Establish a distinctive banking sector report system and improve the monitoring indicator system for banking risks in the FTA. Optimize the calculation methods and regulatory requirements for certain indicators, such as the loan-to-deposit ratio and liquidity.




Copyright: China Banking Regulatory Commission
ADDR:Jia N0.15 Financial Street, Xicheng District, Beijing, 100033