China aims to triple minimum capital level for new foreign banks - paper
SHANGHAI, Oct 9 (Reuters) - China's banking regulator plans to more than triple the minimum registered capital requirement for new wholly-owned foreign banks and joint-venture banks, a state-owned newspaper reported on Wednesday.
The Shanghai Securities News said that the China Banking and Regulatory Commission (CBRC), in a bid to boost risk management, intends to raise the minimum capital requirement for new ventures to 1 billion yuan ($163.37 million) from the current 300 million yuan.
Chinese regulators have been tightening rules on foreign banks setting up in the country. In August, they outlined plans to increase capital adequacy requirements and impose stricter rules on foreign investment.
The newspaper said the CBRC, which is seeking public comment on its plan, intends to expand the scope of permitted activities for foreign banks to include yuan-denominated loans, wealth management through overseas investment products and credit card business.
In a bid to tighten risk control, the CBRC has also proposed to limit foreign banks' derivatives trading business based on their experience and qualifications, the paper said.
China attracted a wave of foreign investment into its state-owned banks from 2004 to 2008 when the country sought to make them into commercial entities as part of sweeping banking reforms.
Foreign firms helped Chinese banks become more market-oriented in those years, but many international investors have sold their stakes at huge profits in recent years.
The sales sparked criticism in some Chinese circles that state assets had been sold too cheaply, leading to calls to limit fresh foreign investment in the sector.
($1 = 6.1211 Chinese yuan)
(Reporting by Fayen Wong and Ruby Lian; Editing by Richard Borsuk)