The China Banking Regulatory Commission (CBRC) issued follow-up rules detailing regulatory requirements and procedures for the establishment of auto financing companies. These companies are required to have capital adequacy ratios of 10 percent, which is stricter than the 8 percent requirement for commercial banks.
Total guaranteed outstanding loans must not exceed 200 percent of the financing company's registered capital, nor can they offer preferential treatment to related parties. Interest rates can be up to 10 percent less or 30 percent more than the base rate set by the central bank. Companies are required to have at least RMB 4 billion in assets.