NFRA Launches Pilot Program to Ease M&A Loan Policies for Tech Enterprises

Recently, the National Financial Regulatory Administration (NFRA) launched a pilot program aimed at moderately easing certain provisions of the Guidelines for M&A Loan Risk Management of Commercial Banks (Yinjianfa [2015] No. 5) for tech enterprises.

For controlling-type mergers and acquisitions, the NFRA plans to pilot the relaxation of the loan proportion of the enterprise’s M&A transaction from “should not exceed 60%” to “should not exceed 80%,” and extend the loan term from “generally not exceeding seven years” to “generally not exceeding ten years.” The pilot will be conducted in 18 cities, including Beijing, Shanghai, Tianjin, Chongqing, Nanjing, Hangzhou, Hefei, Jinan, Wuhan, Changsha, Guangzhou, Chengdu, Xi’an, Ningbo, Xiamen, Qingdao, Shenzhen, and Suzhou.