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	ANNOUNCEMENT OF THE CHINA BANKING REGULATORY COMMISSION ON FURTHER OPENING UP CHINA'S BANKING INDUSTRY

	(promulgated on November 24, 2004; shall come into force as of December 1, 2004)


SUBJECT : BANKING INDUSTRY; FOREIGN-FUNDED; OPEN
ISSUING DEPARTMENT : CHINA BANKING REGULATORY COMMISSION
ISSUE DATE : 11/24/2004
IMPLEMENT DATE : 12/01/2004
LENGTH : 421 words
TEXT :

In a bid to honor China's WTO commitments and promote the economic development of China's western and north-eastern areas, China's Banking Regulatory Commission (CBRC) will implement the following policies on further opening up China's banking industry:

I. As effective on December 1, 2004, foreign-funded financial institutions are allowed to engage in renminbi businesses in five additional cities, namely, Kunming, Beijing, Xiamen, Xi'an and Shenyang. From then on, foreign-funded financial institutions located in these cities may apply to conduct renminbi businesses. The application shall be prepared in compliance with the Regulation of the People's Republic of China Governing Foreign-funded Financial Institutions and the Rules for Implementing the Regulation of the People's Republic of China Governing Foreign-funded Financial Institutions. It shall be filed with the relevant CBRC local office for preliminary examination and then be forwarded to the CBRC headquarters for final approval. The foreign-funded financial institutions that have been authorized to operate renminbi businesses are automatically allowed to conduct renminbi businesses in the above five cities.

II. As effective on December 1, 2004, foreign bank branches located in China's western and north-eastern areas enjoy a more relaxed profitability requirement when applying for conducting renminbi businesses. To be specific, when examining such an application, the CBRC will assess the profitability of all the Chinese Branches of the foreign bank on a consolidated basis, instead of assessing the profitability of the applicant branch only.

III. The CBRC is providing expedited examination and procedures for the application by a foreign bank to set up new establishments or offer new lines of businesses in China's western or north-eastern areas.

IV. As effective on December 1, 2004, a foreign banking institution wishing a set up representative offices in China shall submit the application documents directly to the CBRC with a copy to the CBRC local office at the same location as the proposed representative office. Starting from the same day, each CBRC local office is empowered to examine and approve the chief representative of a foreign bank representative office.

V. As effective on January 1, 2005, a foreign bank, after a prior report with the relevant CBRC local office, may engage in insurance agency business within its allowed range of clients and business scope.

In addition, the CBRC will, under the precondition of adhering to the principle of prudential supervision, speed up the examination and approval of foreign-banks' applications for setting up sub-branches, engaging in renminbi businesses or derivatives activities, etc., and thereby providing a more desirable environment for the business development of foreign banks in China.