Feb. 22 (Bloomberg) -- China will let its commercial banks invest in Japanese stocks and funds, signaling that the government is widening the scope of its overseas investment program.

The move is intended to let more Chinese investors participate in global capital markets to further risk, the China Banking Regulatory Commission said in a statement posted on its Web site today.

China will ``soon'' sign similar agreements with the U.S. and German governments under the so-called qualified domestic institutional investor, or QDII, program, the industry watchdog said in January, without specifying a timeline.

The Chinese government is expanding investment destinations for its QDII program after four funds posted combined losses of 11.8 billion yuan ($1.7 billion) in the fourth quarter of 2007. In addition to Japan, Chinese banks are able to invest in Hong Kong, the U.K. and Singapore on behalf of clients.

Today's release didn't say when QDII funds can start investing in Japan.

To contact the reporter on this story: Josephine Lau in Beijing at jlau22@bloomberg.net

Last Updated: February 22, 2008 05:55 EST