Hong Kong Shanghai Banking Corporation (HSBC) secured approval from the State Administration of Foreign Exchange (SAFE) for another US$50 million investment quota under the qualified foreign institutional investors (QFII) scheme, raising the bank's total to US$100 million.
UBS Limited, the first foreign institution to get a QFII license, has almost used up its US$300 million quota and has applied for it to be raised to US$500 million. UBS made its maiden investment in July.
China has approved nine foreign institutions as QFIIs, which means they can invest in RMB-denominated A shares, bonds, mutual funds and other products approved by the Chinese authorities. They have to open special RMB accounts at designated custodian banks and cooperate with local securities companies to facilitate the investments.
There are still five to six foreign companies waiting to get the QFII license, according to SAFE, which has already granted more than US$1 billion of investment quota.
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