Legislation roundup: Online loans, fund custody and fund trusts
May 15, 2020 | BY
Susan MokOnline loans should be offered in a small scale, CBIRC supports foreign bank branches in applying for fund custody qualifications and trust companies are required to penetratingly identify the underlying assets.
Banking and Finance
China Banking and Insurance Regulatory Commission, Tentative Measures for the Administration of Online Loans Made by Commercial Banks (Draft for Comments)
Online loans are required to comply with the principles of small amount, short-term, high efficiency and controllable risks.
The credit limit on a personal credit loan extended to a single customer for consumption purposes may not exceed Rmb200,000, the principal is to be repaid in one lump sum upon maturity and the credit term may not exceed one year.
A local bank with legal personality that engages in online loan business shall mainly serve local customers
Further reading
Capital Markets
China Securities Regulatory Commission, Measures for the Administration of the Securities Investment Fund Custody Business
The Measures support foreign bank branches in applying for fund custody qualifications, suitably consider the scale of assets and business experience of the head offices of the foreign banks, specify the conditions a branch is required to fulfill to apply and further improve the access arrangements, such as net assets.
The Measures improve the arrangements for the oversight of fund custodians, establish a mechanism for pursuing the liability of head offices of foreign banks and set forth the requirements in respect of the cross-border setup of information systems and the cross-border flow of data.
See the digest for more details.
Further reading
Trust
China Banking and Insurance Regulatory Commission, Tentative Measures for the Administration of the Fund Trusts of Trust Companies (Draft for Comments)
A fund trust that accepts participation by other asset management products may not further invest in asset management products other than public securities investment funds. Where a fund trust invests in another asset management product, the trust company is required to penetratingly identify the underlying assets. The percentage invested in total by a fund trust in any one or any single type of asset in accordance with the penetration principle is required to comply with relevant provisions of the State Council's banking regulator.
Further reading
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