To implement the decisions and arrangements of the CPC Central Committee and the State Council on deepening the financial supply-side structural reform, drive the foreign exchange administration reform, and fuel the foreign exchange business growth in non-banking financial institutions, the State Administration of Foreign Exchange (SAFE) has recently approved of piloting in 3 securities companies for foreign exchange settlement and sales, including CITIC Securities Company Limited, Huatai Securities Company Limited and China Merchants Securities Co., Ltd., allowing them to conduct spot foreign exchange settlement and sales for themselves and their customers while keeping risks under control and to transact in the interbank foreign exchange market in compliance with rules and regulations.

Such a pilot program will help drive balanced growth of both domestic and foreign currencies in domestic securities companies, speed up the fostering of world-class investment banks, and boost the high-quality growth of the financial industry. It will also contribute to expansion of players in the foreign exchange market and diversification of categories for foreign exchange transactions, and further fuel the growth of the foreign exchange market in depth, width and activeness and improve the market-based RMB exchange rate formation mechanism.

The SAFE's next steps are to guide pilot companies to conduct foreign exchange sales and settlement in a good order and summarize their experience and learnings, and to attract more players into the foreign exchange market, so as to boost the healthy growth of foreign exchange businesses in non-banking financial institutions.