UPDATE 1-China raises foreign institutional investor quota by $3.4 bln in January

Monday, 27 Jan 2014 | 3:39 AM ET

January@ (Adds details on investment quotas)

BEIJING/HONG KONG, Jan 27 (Reuters) - China granted $3.4 billion in fresh quotas to licensed overseas institutional investors this month as of Jan. 27, according to data released by the State Administration of Foreign Exchange (SAFE) on Monday.

Half of that amount was issued under the dollar-denominated Qualified Foreign Institutional Investor (QFII) programme, with the other half issued under the Renminbi Qualified Foreign Institutional Investor (RQFII) programme.

CSOP Asset Management, which earlier this month announced the launch of the first first RQFII exchange-traded fund (ETF) listed in London, received 4 billion yuan ($661.3 million) in fresh RQFII quotas in January alone.

It now has 34.1 billion yuan in total, the largest under the renminbi-denominated programme.

This takes the total quotas issued under the QFII programme to $51.4 billion as of Jan. 27 from $49.7 billion at the end of December, and to 167.8 billion yuan ($27.74 billion) from 157.5 billion yuan under the RQFII programme, according to SAFE data.

Institutional investors need to apply for a licence from the securities regulator to be eligible to seek investment quotas from the foreign exchange regulator.

According to data released on Jan. 20, the China Securities Regulatory Commission did not grant any new QFII licences in December, keeping the total at 251. Four RQFII licenses were issued in December, bringing the total to 43.

China's stock markets have skidded so far this year on concerns about slowing economic growth, the resumption of initial public offerings and regulators' attempts to crack down on riskier lending practices.

For a graphic on China's QFII approvals, click:


($1 = 6.0488 Chinese yuan)

(Reporting by Jonathan Standing in BEIJING and Clement Tan in HONG KONG; Editing by Richard Borsuk & Kim Coghill)