Rules for RQFII trial programs unveiled
Source: Xinhua |
December 17, 2011, Saturday
|
Print Edition
Print Edition
CHINA yesterday issued rules for pilot programs of RMB Qualified Foreign Institutional Investors (RQFII), formally giving a green light to investment of overseas yuan funds on the mainland's securities markets.
The move is expected to widen the investment channel of overseas yuan funds and add new momentum to the country's bid to make the yuan an international currency.
Hong Kong subsidiaries of fund management companies and securities firms can use yuan funds raised in Hong Kong to invest in mainland securities within a permitted quota, according to the rules jointly released by the China Securities Regulatory Commission, the People's Bank of China and the State Administration of Foreign Exchange.
The total investment quota of RQFII pilot programs is set at around 20 billion yuan (US$3.15 billion), according to the rules.
To control risks, qualified investors should invest no less than 80 percent of the yuan funds they raised in fixed-income securities, while investment in stocks and equity funds should account for no more than 20 percent.
The CSRC will join other related departments to study the possibility of further expanding the trial program after its launch, said a CSRC official who declined to be identified.
The launch of the RQFII will open another significant channel for overseas yuan funds to flow back into the country, he added.
The yuan is not fully convertible under the capital account but China has stepped up efforts to make the currency more international over the past few years.
The move is expected to widen the investment channel of overseas yuan funds and add new momentum to the country's bid to make the yuan an international currency.
Hong Kong subsidiaries of fund management companies and securities firms can use yuan funds raised in Hong Kong to invest in mainland securities within a permitted quota, according to the rules jointly released by the China Securities Regulatory Commission, the People's Bank of China and the State Administration of Foreign Exchange.
The total investment quota of RQFII pilot programs is set at around 20 billion yuan (US$3.15 billion), according to the rules.
To control risks, qualified investors should invest no less than 80 percent of the yuan funds they raised in fixed-income securities, while investment in stocks and equity funds should account for no more than 20 percent.
The CSRC will join other related departments to study the possibility of further expanding the trial program after its launch, said a CSRC official who declined to be identified.
The launch of the RQFII will open another significant channel for overseas yuan funds to flow back into the country, he added.
The yuan is not fully convertible under the capital account but China has stepped up efforts to make the currency more international over the past few years.
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