The leaders of the relevant departments of the People's Bank of China and the State Administration of Foreign Exchange answered questions from reporters on the "Notice on Adjusting Matters Related to Overseas Lending Business of Banking Financial Institutions".

Question: What adjustments have been made to the current overseas loan policy in the "Notification"? The "Notification" has made adjustments in two aspects. Firstly, it increased the limit on the balance of overseas loans. The "Notice on Relevant Issues of Overseas Loan Business of Banking Financial Institutions" specifies that the limit on the balance of overseas loans = net level one capital of domestic banks x leverage ratio of overseas loans x macro-prudential adjustment parameter. If the calculated limit is less than 20 billion RMB, it is set at 20 billion RMB. At the same time, considering the net level one capital and existing business scale of each bank, different leverage ratios have been set for the China Development Bank, the Export-Import Bank, and other banks, providing sufficient space for banking operations. In recent years, with the development of overseas loan business, the balances of overseas loans of some banks have gradually approached the limit. Taking into account the actual situations of different banks in terms of business scale and the relatively small capital size of domestic and foreign banks, the leverage ratio for domestic and foreign banks has been raised from 0.5 to 1.5, the leverage ratio for the Export-Import Bank has been raised from 3 to 3.5, and the approved limit of 20 billion RMB has been raised to 100 billion RMB, better supporting foreign banks and the Export-Import Bank in utilizing their business advantages and meeting the reasonable financing needs of overseas enterprises. Secondly, it optimized the management requirements for indirect loan methods. The second article of the "Notification" specifies that if domestic banks indirectly provide overseas enterprises with loans in foreign currencies for a period of more than one year through methods like lending funds to overseas banks, the overseas banks can handle it in accordance with relevant laws and regulations of their country or region. After the issuance of the "Notification", domestic banks should follow the principles of legality, compliance, prudent operation, and risk control, improve internal control systems and operational procedures, and clarify the conditions for the use of funds through agreements with overseas banks to effectively prevent risks.