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Establish a Solely Foreign-funded Bank in China

Updated:2018-12-4 15:18:47    Source:www.tannet-group.comViews:328

Establish a solely foreign-funded bank in China is possible by foreign investors. Foreign-funded banks refer to banks established solely by foreign investors within the territory of the People’s Republic of China. The operation scope of foreign banks varies according to the different laws and management systems of banks in different countries. Some countries restrict the scope of operation of foreign banks in order to stabilize their own currencies, while others treat the business management of foreign banks equally with that of their own banks. Below are the relevant information about the solely foreign-funded bank registration in China.

Basic Application Requirements
The investor of the solely-funded bank must be financial organizations which should meet the following requirements:
1. The only or the largest shareholder of both the solely-funded bank have to be commercial banks and their capital adequacy rates should not be lower than 8%;
2. The only or the largest shareholder of the solely-funded bank must already have set up their representative branch in China for more than 2 years;
3. The investor of the solely-funded bank should have appropriate rules and legislation for financial supervision in their own countries or regions and they should also be under effective supervision by local bureaus in their countries or regions;
4. The investor of the solely-funded bank should have permission from their domestic authorities which are in charge;
5. Branches located in China of solely-funded foreign should receive at least RMB 100,000,000 or equivalent value in foreign currencies which can be converted freely form their headquarters for operation at no cost. However, the sum should not exceed 60% headquarters total capital;
6. Branches of foreign banks, should receive at least RMB200,000,000 or equivalent value in foreign currencies which can be converted freely form their headquarters for operation at no cost.

To set up solely-funded banks, applicants must also satisfy the following requirements:
1. Having reasonable legal person’s governance structure;
2. Having good persistent operational achievement;
3. Producing financial reports and the accounting firm should have clean report for the 3 years before application;
4. No severe law violation, no bad credit record;
5. Having good business reputations and social status;
6. Financial investors have to be suitable for all other requirements stated by law and legislation
7. Other requirements regulated by China Banking Regulatory Commission (CBRC).

How to Establish a Solely Foreign-funded Bank in China?
It is possible for foreign investors to establish a solely foreign-funded bank in China provided that the following requirements and conditions are met. Generally, there will involve two approval procedures:
1. Approval for the preparation and establishment of wholly foreign-funded bank;
2. Approval for the opening of wholly foreign-funded bank.

In order to get such approvals, you need to prepare a list of documents, such as:
1. Application Form;
2. Office address and relevant evidential documents;
3. Articles of Association;
4. Organizational chart;
5. Feasibility study report;
6. Audited report and capital verification ;
7. Other materials required by the China Banking Regulatory Commission (CBRC).

For more detailed information about the required documents, please contact Tannet. Tannet is committed to basing on the Grand China and serving the world of business with borderless, cross-industry, one-stop and tailor-made solutions ranging from business setup to bushiness followup and business speedup.

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If you have further inquires, please do not hesitate to contact Tannet at anytime, anywhere by simply visiting Tannet’s website english.tannet-group.com, or calling Hong Kong hotline at 852-27826888 or China hotline at 86-755-82143422, or emailing to tannet-solution@hotmail.com. You are also welcome to visit our office situated in 16/F, Taiyangdao Bldg 2020,Dongmen Rd South, Luohu District, Shenzhen, China.

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