CBRC promulgated the Announcement of China Banking Regulatory Commission on Relevant
Issues after the Promulgation of the Detailed Rules for the Implementation of the Regulation of the
People’s Republic of China on the Administration of Foreign-funded Banks on November
24, 2006, announcing the relevant matters about the implementation of the Regulation and the
Detailed Rules. It provides that:

  1. As of December 11, 2006, the geographical and client restrictions on the foreign-funded
    banks in their provision of RMB services shall be canceled.
  2.  Those branches of foreign-funded banks that have been approved to provide RMB
    services for non-foreign-funded enterprises may, without the approval and after the
    alteration of business licenses, enlarge their business scope to the absorption of time
    deposits with each sum at one million yuan or more from the citizens within the territory of
    China. 
  3. Where the registered capital or operating capital of a wholly foreign-funded bank, Sinoforeign
    joint venture bank, or branch of a foreign bank established before the
    implementation of the Regulation is less than the amount prescribed in the Regulation and
    the Detailed Rules, if the current potential clients and business scope remain unchanged,
    its current registered capital or operating capital may keep unchanged. 
  4. Those wholly foreign-funded banks that are restructured by the branches of foreign banks
    and are solely funded by their headquarters, as well as the wholly foreign-funded banks
    and Sino-foreign joint venture banks established before the implementation of the
    Regulation shall, before December 31, 2011, meet the provisions that “the proportion of
    the balance of loans to the balance of deposits shall not exceed 75%” and “the proportion
    of the balance of loans to the same borrower and the balance of capital of the commercial
    bank shall not exceed 10%.” Within the term of extension, the credit-granting quota of a
    wholly foreign-funded bank or Sino-foreign joint venture bank to the same enterprise and
    the affiliated enterprises thereof shall not exceed 25% of its capital. 
  5. No wholly foreign-funded bank or Sino-foreign joint venture bank may establish
    representative offices again. The supervision over and administration of those
    representative offices of wholly foreign-funded banks and Sino-foreign joint venture banks
    as established before the implementation of the Regulation shall be governed by the  Regulation and the Detailed Rules by analogy.