Foreign banks operating in Shanghai have submitted applications one after another to the People's Bank of China (PBC), China's Central Bank, for permission to expand their business scope and capital circulation.
In February this year, China issued two circulars on the management of foreign financial institutions' business in China and on detailed implementation methods, respectively, which worked together to provide policy guidance for foreign banking companies doing RMB business in China.
The applications submitted for both foreign currency and RMB business by foreign banks are seen as their active response to the statutes. Financial analysts here commented that the move shows foreign banks holding an optimistic attitude towards their business in China.
The statutes made some amendments on the preconditions for foreign banks to open RMB business in China, such as easing the formalities for checking the scales of foreign currency loans, which is considered a lessened requirement to allow foreign banks to enter the market.
Foreign banks which have acquired RMB business permits reacted with an enthusiasm by contacting the Shanghai Branch of PBC to express the intention of applying for market permission. They included the Hang Seng Bank of Hong Kong and banks from Belgium and Italy.
PBC Shanghai will make an initial examination of the applications before submitting them for approval at its headquarters in Beijing.
(Xinhua News Agency March 15, 2002)
