China eases market access for foreign banks

BEIJING, Dec 20 (PTI): China has eased rules which will provide market access for foreign banks, in a move to further open up the domestic banking sector.

The Chinese cabinet published the amended rules today which will no longer require a specific amount of operating funds to be transferred from the parent foreign bank to its newly-established Chinese branch.

Previously, a foreign bank would have to unconditionally allocate at least 100 million yuan (around US$ 16.4 million) or the same value in other freely-convertible currencies.

The requirement has had a restrictive impact on capital replenishing at foreign banks' China branches.

Meanwhile, direct capital injection from parent companies to their branches would also be treated as foreign direct investment, which often involved a complicated approval process from multiple government agencies, state-run Xinhua news agency reported.