Chapter I General Rules

Article 1 In order to further develop the currency market, regulate interbank borrowing trading, prevent interbank borrowing risks and maintain the legitimate rights and interests of all the parties involved in the interbank borrowing, these Measures are formulated in accordance with the Law of the People's Republic of China on the People's Bank of China, the Law of the People's Republic of China on Commercial Banks and other laws and administrative regulations.

Article 2 These Measures shall apply to renminbi interbank borrowing trading between those financial institutions as legally established within the territory of the People's Republic of China.

Article 3 Interbank borrowing as referred to in these Measures means the unsecured financing as conducted between those financial institutions that have entered the national interbank borrowing market (hereinafter referred to as interbank borrowing market) upon the approval of the People's Bank of China (PBC) via national unified interbank borrowing networks. The national unified interbank borrowing networks include:

(1) Electronic Trading System of the National Interbank Funding Center;

(2) Borrowing filing systems of PBC branches; and

(3) Other trading systems as authorized by the PBC.

Article 4 The PBC will supervise and administrate the interbank borrowing market in accordance with relevant laws. Any financial institutions may enter into the interbank borrowing market upon the approval of the PBC, and engage in the interbank borrowing trading under the supervision and inspection of the PBC.

Article 5 The principle of fairness, free will, integrity, self discipline and being at one's own risks shall be observed in the interbank borrowing trading.

Chapter II Market Access Management

Article 6 The financial institutions as follows may make an application to the PBC for entering the interbank borrowing market:

(1) Policy banks;

(2) Chinese-invested commercial banks;

(3) Solely foreign-funded banks and Chinese-foreign joint venture banks;

(4) Urban credit cooperatives;

(5) Rural credit cooperative unions at county level;

(6) Corporate finance companies;

(7) Trust companies;

(8) Financial assets management companies;

(9) Financial leasing companies;

(10) Auto financing companies;

(11) Securities companies;

(12) Insurance companies;

(13) Insurance assets management companies;

(14) First-class branches as authorized by Chinese-invested commercial banks (excluding urban commercial banks, rural commercial banks and rural cooperative banks);

(15) Branches of foreign banks; and

(16) Other institutions as affirmed by the PBC.

Article 7 The following requirements shall be satisfied by a financial institution that applies for entering the interbank borrowing market:

(1) It shall be lawfully established within the territory of the People's Republic of China;

(2) It has a sound and perfect interbank borrowing organizational structure, risk management system and internal control system;

(3) It has special staff that conducts interbank borrowing trading;

(4) The main supervisory indicators thereof shall conform to the provisions as prescribed by the PBC and other competent regulatory authorities;

(5) It has no record of punishment as imposed by the PBC or any competent regulatory authority because of any illegal or irregular act for the past two years;

(6) It has no circumstance as insolvency in the past two years; and

(7) Other requirements as prescribed by the PBC.

Article 8 In addition to the requirements as prescribed in Article 7 of these Measures, the following applicants for entering the interbank borrowing market shall also meet the following requirements:

(1) A solely foreign-funded bank, Chinese-foreign joint venture bank or branch of a foreign bank shall obtain the qualification for renminbi business upon approval of the banking regulatory authority under the State Council;

(2) A corporate finance company, trust company, financial assets management company, financial leasing company, auto financing company or insurance assets management company shall have gained profits for the past two successive years prior to making an application for entering the interbank borrowing market;

(3) A securities company shall have gained profits for the past two successive years prior to making an application for entering the interbank borrowing market, and its net capital shall be no less than 200 million yuan in the same term; and

(4) An insurance company shall have the adequacy ratio of its repayment capacity at or above 120 percent successively for the recent four quarters prior to making an application for entering the interbank borrowing market.

Article 9 A financial institution that applies for entering the interbank borrowing market shall file application materials to the PBC or its branches in light of the procedures as prescribed by the PBC.

Article 10 The term for the PBC or its branches to assess the applications of financial institutions for entering the interbank borrowing market shall be subject to the provisions as prescribed in Articles 28 and 29 of the Measures of the People's Bank of China for the Implementation of Administrative Licensing.

Article 11 Where any financial institution that has already entered the interbank borrowing market determines to withdraw from the interbank borrowing market, it shall report to the PBC or its branches no less than 30 days in advance, specify the reasons for withdrawal from the interbank borrowing market at the same time, and shall submit a plan for liquidation and disposal of creditors' rights and debts as well.

Where a financial institution determines to withdraw from the interbank borrowing market, it shall take effective measures to ensure the smooth liquidation of creditors' rights and debts, and constitute a pre-scheme for effective risk disposal against any possible problem.

Article 12 The PBC or its branches shall publicize in the interbank borrowing market in a proper manner when it approves the entering of a financial institution into the interbank borrowing market or receives a report of a financial institution on its withdrawal from the interbank borrowing market. No institution may illegally release any relevant information to the market before the PBC or its branches publicize an official bulletin.

Article 13 The PBC or its branches shall not accept any application from the financial institution for entering the interbank borrowing market within two years as of the bulletin on its withdrawal from the interbank borrowing market.

Chapter III Trading and Settlement

Article 14 The interbank borrowing trading must be performed inside the national unified interbank borrowing network.

A policy bank, corporate finance company, trust company, financial assets management company, financial leasing company, auto financing company, securities company, insurance company or insurance assets management company shall conduct the interbank borrowing in the name of a legal person through the Electronic Trading System of the National Interbank Funding Center.

Those financial institutions that conduct interbank borrowing trading through the interbank borrowing filing systems of PBC branches shall go through relevant formalities in accordance with the provisions as prescribed by the local PBC branches.

Article 15 The interbank borrowing trading shall be performed by means of inquiries, upon independent negotiations and on each transaction.

Article 16 The interbank offered rate shall be negotiated and determined by both trading parties.

Article 17 Where financial institutions conduct interbank borrowing trading, they shall conclude contracts on each transaction. A transaction contract shall be detailed and specific, and the rights and obligations of both parties in the interbank borrowing shall be stipulated in detail. A contract shall include the items as follows:

(1) Names, domiciles and names of legal representatives of both parties in the interbank borrowing;