China has loosened market access restrictions on foreign banks, in a largely symbolic move to make good on promises to open the country’s domestic financial sector to competition.

The cabinet decreased the waiting period for foreign banks to apply to conduct renminbi business from three years after establishing operations in China to one year, and dropped the requirement that a bank be profitable for two consecutive years before applying for a renminbi licence. Foreign banks without a renminbi licence are limited to conducting foreign currency business.

Foreign lenders have long complained about regulations fettering their growth in China, where they controlled only 1.7 per cent of total banking assets at the end of 2013, according to official data.