The State Council of China has unveiled a new set of rules which will make it easier for foreign banks to open branches and enter renminbi business in China.
The new rules have revised existing rules to phase out the requirement for foreign-owned banks to pump at least CNY 100m ($16.08m) or an equivalent in other freely-convertible currencies into a new Chinese branch.
Foreign banks will now be eligible to conduct yuan transactions after operating in China for one year, down from the previous requirement of three years, and the two-year profit requirement has also been eliminated.
Under the revised rules, banks will no longer be required to establish a Chinese representative office before setting up other branches.
Besides, a foreign bank’s branches will also no longer face hurdles to conduct renminbi business if it already has one branch doing so.
The new rules are expected to be effective from January 1 of next year.