China Scraps QFII Limit on Sovereign Funds, Central Banks

China scrapped a ceiling on investments by overseas sovereign wealth funds and central banks in its capital markets, part of government efforts to encourage long-term foreign ownership and shore up slumping equities.

Sovereign funds, central banks and monetary authorities can now exceed the $1 billion limit that still applies to other qualified foreign institutional investors, according to revised regulations posted Dec. 14 on the State Administration of Foreign Exchange’s website. The statement did not mention a new ceiling or an increase in the total investment quota allowed under the program also known as QFII.