OREANDA-NEWS. June 17, 2011. In consultation with the National Development and Reform Commission and the Ministry of Commerce, the PBC jointly with the SAFE issued the Administrative Measures on Pilot RMB Settlement for Outward Direct Investment (PBC Document [2011] No.1), allowing commercial banks and enterprises located in areas designated for the pilot cross-border RMB trade settlement scheme to conduct RMB settlement for outward direct investment business.

On January 14, the PBC announced it would raise the RMB reserve requirement ratio for deposit-taking financial institutions by 0.5 percentage points, effective from January 20, 2011.

On January 25, the PBC reported to the Finance and Economy Committee of the National People’s Congress on implementation of the monetary policy in 2010.

On January 30, the Monetary Policy Report for Q4 2010 was released.

On February 9, the PBC decided to raise the RMB benchmark deposit and loan rates of financial institutions. The one-year benchmark deposit rate was raised from its current level of 2.75 percent to 3 percent, up 0.25 percentage points. The one-year benchmark loan rate was raised from its current level of 5.81 percent to 6.06 percent, up 0.25 percentage points. The benchmark rates on deposits and loans of other maturities and personal provident housing funds were adjusted accordingly.

On February 14, in order to further enrich products traded on the foreign exchange market and provide enterprises and banks more tools for hedging exchange-rate risks, the SAFE issued the Notice on Issues Relating to RMB-FOREX Options Trading (SAFE Document [2011] No. 8), allowing the China Foreign Exchange Trade System to launch RMB-FOREX options trading on the interbank foreign exchange market.

On February 17, the PBC decided to implement differentiated reserve requirements for local financial institutions with legal person status that had relatively low capital adequacy ratios but saw rapid credit increase.

On February 18, the PBC announced it would raise the RMB reserve requirement ratio for deposit-taking financial institutions by 0.5 percentage points, effective from February 24, 2011.

On February 22, the PBC General Administration Department issued the Notice on Increasing Credit Lines for Central Bank Lending to Agriculture and Supporting Key Areas to Make Proper Financial Arrangements for Combating Drought (PBC General Administration Department Document [2011] No.45), which would increase the central bank lending credit line by 10 billion yuan for 8 drought-affected provinces, including Henan, Shandong and Hebei, so as to support and guide financial institutions to make their utmost efforts to provide proper financial services for anti-drought work, to support a stable increase in agricultural products, and to ensure a bumper harvest.

On March 18, the PBC announced it would raise the RMB reserve requirement ratio for deposit-taking financial institutions by 0.5 percentage points, effective from March 25, 2011.

On March 18, in order to guide the cross-border funds flow, pre-empt inflows of illegal and irregular funds, and safeguard China’s financial security, the SAFE issued the Notice on Strengthening Foreign Exchange Administration (SAFE Document [2011] No. 11)

On March 25, the Monetary Policy Committee of the PBC convened first regular quarterly meeting in 2011.

On March 28, the 20th regular meeting of the committee that reviews the redemption of special central bank notes under the pilot program initiated by the PBC for the reform of rural credit cooperatives (RCCs) decided to redeem central bank notes issued to RCCs in Dunchang county and 18 other counties and county-level cities in 4 provinces/autonomous regions, including Hainan Province, with a total quota of 1.99 billion yuan.