State Administration of Foreign Exchange, Circular on Issues Relevant to Improving Administration of the Overall Foreign Exchange Conversion and Sale Position of Banks

国家外汇管理局关于完善银行结售汇综合头寸管理有关问题的通知

May 04, 2012 | BY

clpstaff &clp articles &

Lower limit of overall forex conversion and sale position of banks revised to below zero.

Clp Reference: 3810/12.04.26 Promulgated: 2012-04-26 Effective: 2012-04-26

Issued: April 26 2012
Effective: as of date of issuance

Main contents: The overall foreign exchange conversion and sale position of banks shall be subject to administration using a positive-negative range. On the basis of the existing administration by an upper and lower limit on the overall foreign exchange conversion and sale position, the lower limit is revised to below zero (Article 1).

With the exception of the lower limits on the overall foreign exchange conversion and sale position of national banks and of spot market makers in the interbank foreign exchange market that shall be notified separately by the State Administration of Foreign Exchange, the following rates shall apply to the lower limit on the overall foreign exchange conversion and sale position of all other banks (including enterprise group finance companies that have secured qualifications to engage in foreign exchange conversion and sale business):

(1) for those banks whose volume of foreign exchange conversion and sale business was less than US$100 million in 2011 and those that have recently secured qualifications to engage in foreign exchange conversion and sale business, the lower limit on their overall foreign exchange conversion and sale position shall be ‑US$3 million;

(2) for those whose volume of foreign exchange conversion and sale business was between US$100 million and US$1 billion in 2011, the lower limit on their overall foreign exchange conversion and sale position shall be ‑US$5 million; and

(3) for those whose volume of foreign exchange conversion and sale business was greater than US$1 billion in 2011, the lower limit on their overall foreign exchange conversion and sale position shall be ‑US$10 million (Article 2).

The administration of the lower limit implemented for the position balance under bank-cash-basis accounting is cancelled (Article 3).

Repealed legislation: Article 1 of the Circular on Issues Relevant to Strengthening the Administration of Foreign Exchange Transactions, Nov 9 2010, CLP 2010 No.10 p.48 and Article 1 of the Circular on Issues Relevant to Further Strengthening the Administration of Foreign Exchange Transactions, Mar 18 2011, CLP 2011 No.4 p.28

clp reference:3810/12.04.26promulgated:2012-04-26effective:2012-04-26

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