Wait for banking regulations almost over

Foreign lending institutions will only have to wait a few more weeks for a rule allowing overseas banks to deal with renminbi business nationwide, the China Daily reported on October 11 2006. The rule is expected to be submitted to the State Council for further approval and will be released in November.

China is expected to open up its banking sector to foreign companies by December 11 2006, pursuant to its World Trade Organization membership commitments.

Compared to the draft version which the China Banking Regulatory Commission (CBRC) sent out to China's administrative bodies and foreign banks for comments, the banking rule will undergo very little change. Under the draft rule, foreign lenders are encouraged to register local companies within China rather than to establish branches to conduct renminbi business, as it will lower their investment threshold for entering the Chinese market.