According to data from the State Administration of Foreign Exchange (SAFE) in China, the new quotas may have more than doubled from previous quotas.
A pilot project is expected to be launched for increasing the debt quota for which participants will be HSBC Holdings, Deutsche Bank, JP Morgan, Citigroup, Sumitomo Mitsui Banking and Bank of East Asia, the regulator said in a statement.
The regulator was quoted by Reiters as saying that the quota is intended at "promoting opening-up of the financial sector, giving a bigger role to foreign banks in capital flows, and pushing forward national economic development."
Foreign banks can lend yuan from overseas markets, however, the size, maturity and the lenders of such yuan loans will have to be reported, NDRC added.
As at end of 2011, foreign banks in China held an outstanding foreign debt of $54bn including both long-term and short-term debt, which accounts 12.13% of China’s total foreign debt, as per government data.
