China has extended its Renminbi Qualified Foreign Institutional Investor (RQFII) program to Singapore, with an aggregate quota of RMB50 billion for Singapore.
With effect from January 24, 2014, Singapore-incorporated financial institutions which are approved by the Monetary Authority of Singapore to conduct fund management activities (including registered and licensed fund management companies) may apply for the RQFII license. The RQFII license application should be submitted to the China Securities Regulatory Commission (CSRC) through approved Chinese custodian banks. After the RQFII license is obtained, an application should be made to the State Administration of Foreign Exchange (SAFE) for an RQFII investment quota, and where necessary to the People’s Bank of China (PBC) for access to the Chinese inter-bank bond market subsequently. Singapore financial institutions with a RQFII license will then be able to offer Renminbi (RMB) investment products to Singapore investors, and to invest offshore RMB from Singapore into China’s securities markets within their allocated quota.