China Further Regulates Offshore Loan Business of Domestic Banking Financial Institutions
The People's Bank of China and the State Administration of Foreign Exchange intend to further regulate the offshore lending business of domestic banking financial institutions, bringing offshore RMB and foreign exchange lending business into a unified policy framework while encouraging domestic banks to conduct offshore lending business in local currency.
It will further expand the scope of overseas RMB loan business of domestic banks, which is no longer limited to "going out" projects; it will allow overseas RMB loan business to be carried out directly to overseas enterprises and finance medium and long-term funds of more than one year to overseas banks. In addition, the macro-prudential management of cross-border capital flows related to offshore loans of domestic banks will be implemented, and the balance limit of offshore loans will be set.
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