China further opens up insurance, banking sectors to foreign investors

China has decided to further open up its insurance and banking sectors to foreign investors by revising related regulations.

A Chinese clerk counts RMB (renminbi) yuan banknote at a bank in Huaibei City, east China's Anhui Province, August 26, 2015. [File Photo: IC]

The decision regarding revisions to the regulations on management of foreign-invested insurance and of banking firms has been authorized by the State Council and will be implemented immediately on the date of their release, a statement said Tuesday.

The revisions, which are aimed at providing better legal guarantee to opening up the country's insurance and banking sectors to overseas investors, include improving the supervision over foreign banks' local branches and lifting previous restrictions on company establishment, shareholder status and business expansion.

Foreign insurance groups are now allowed to set up foreign-funded insurance firms in the Chinese mainland, while overseas financial institutions can be shareholders of foreign-funded insurance firms.

In the banking sector, foreign players can establish branches and wholly foreign-owned banks at the same time in the Chinese mainland, as well as setting up branches and Sino-foreign joint ventures simultaneously.

Foreign banks no longer need to get prior approvals for conducting renminbi businesses, and are allowed to underwrite government bonds and do certain agent services.

Meanwhile, the floor limit for foreign bank branches in the mainland to take Chinese citizens' time deposit has been lowered from 1 million yuan (about 141,400 U.S. dollars) to 500,000 yuan.

China has kept stepping up efforts in easing financial market access for foreign investors in recent years.

The country's securities regulator on Friday announced a clear timetable for allowing full foreign ownership of financial service companies covering the sectors of fund management, brokerage and futures.