SHANGHAI Dec 1 China's central bank has
circulated new rules for companies which make yuan-denominated
loans to overseas entities, sources with direct knowledge of the
matter said, the latest in a slew of measures by Beijing to
control capital outflows.
The move comes after the yuan fell to more than eight-year
lows, fueling attempts by firms to get their money out and
leading to Beijing taking aim at outbound investments and
underground banks suspected of aiding capital flight.
The party making a yuan loan to an overseas entity must
first register the loan with the State Administration of Foreign
Exchange (SAFE) - the foreign exchange regulator - and must keep
the loan within a certain limit, the sources told Reuters on
Thursday. The limit was not specified.
The People's Bank of China (PBOC) did not immediately
respond to a request for comment.
The lender also has to have been registered for at least a
year, and the borrower has to be a related entity, according to
A lender cannot make a personal loan to an overseas
borrower, and also cannot use debt financing for the purpose of
an overseas loan to a foreign entity.
(Reporting by Zhang Jingdong, Li Zheng and Engen Tham in
Shanghai; Writing by Shu Zhang in Beijing; Editing by Kim