General Office of the State Council, Circular on Transmitting the «China Banking Regulatory Commission, Guiding Opinions on Promoting the Development of Private Banks»

Issued: June 22 2015

Main contents: A private enterprise wishing to invest and take an equity interest in a banking financial institution shall satisfy conditions such as having been lawfully established, having legal person status, having a good corporate governance structure and effective organizational and management methods, having a good public reputation, integrity record and tax paying record, having a relatively long development period and stable economic performance, having relatively strong operational and management capabilities and financing strengths, a good financial position and asset position, having been profitable the three most recent fiscal years, and having net assets, after the year-end distribution, equivalent to at least 30% of the total assets, and a balance of equity-type investments not exceeding 50% of net assets.

A capital owner proposing to invest in a private bank is required to have a good personal reputation, be law abiding, act in good faith and be dedicated in his profession, the corporate governance structure and mechanisms of his legal person shareholder being in compliance with the requirements of the PRC Company Law, its affiliate and equity relationships being simple, clear and transparent and not having an organizational structure with affiliated transactions or record of improper acts.