Further Opening-up for Foreign-Invested Banks
On February 13, 2018, the China Banking Regulatory Commission (the “CBRC”) promulgated the Decision on Amending the CBRC’s Implementation Measures for the Administrative Licensing Matters of Foreign-Invested Banks (CBRC Order 2018 No. 3, the “Order No.3”). Following a series of regulations and policies relating to opening-up of the banking industry issued in 2017 , the Order No.3 is considered to be a further step of great significance for the purpose of implementing the general principles of further expanding opening-up, improving the levels of opening-up of the banking industry and streamlining administration and delegating more powers to lower-level authorities continuously. The foreign-invested banks have been used to conducting business operation on a legal and compliance basis with a robust and prudent risk appetite since their entry into the PRC market, which has been promoting the compliance-based development of the financial market. However, they are also facing the competition against the domestic-funded banks with an aggressive risk appetite, and as a result, the foreign-invested banks remain a relatively slow growth and small market share. The expansion of opening-up and relaxation of the market access are expected to provide further opportunities for the foreign-invested banks to develop their PRC businesses, build and strengthen a compliance culture in the banking industry and push the further compliance-based development of the financial market.