Core Viewpoint - The National Financial Supervision Administration has introduced a new regulatory framework for commercial banks' custody business, outlining prohibited activities to mitigate risks associated with unclear responsibilities [1] Summary by Categories Prohibited Activities - Commercial banks are prohibited from assuming credit risk, market risk, and other risks associated with custody products [1] - Banks cannot provide direct or indirect guarantees for custody products, whether explicit or implicit [1] - There is a ban on promising principal or guaranteed returns for custody products [1] - Banks are not allowed to advance funds or provide liquidity support for custody products, except for qualified collateral management of fixed-income securities conducted under market and legal principles [1] - Participation in investor suitability management is prohibited for commercial banks [1] - Banks cannot guarantee the authenticity of project and transaction information or the legality of fund sources [1] - Involvement in the investment decision-making of managers is not permitted [1] - Mixing custody product assets with other assets is also prohibited [1]

人民财讯12月12日电，金融监管总局制定了《商业银行托管业务监督管理办法(试行)》(以下简称《办 法》)，现正式发布。《办法》的发布实施有利于进一步强化商业银行托管业务监管，明晰商业银行托 管业务范围和经营规范，提升精细化管理水平，更好发挥托管机制作用，为资产管理等领域发展提供更 加有力有效的支持。下一步，金融监管总局将持续督促商业银行提高经营管理水平和风险防范能力，促 进托管业务规范、健康和高质量发展。 ...

Core Viewpoint - The National Financial Supervision Administration has released the "Supervision and Management Measures for Custody Business of Commercial Banks (Trial)" to enhance the regulation and management of custody services, emphasizing the establishment of a negative list for prohibited custody products and strengthening qualification review and risk management [1][27]. Group 1: General Principles - The measures aim to promote the standardized and healthy development of custody business in commercial banks, based on relevant laws and regulations [3][29]. - Custody refers to the act of commercial banks providing asset custody and related services as an independent third party within the People's Republic of China [3][29]. - Custody products include various financial products and investment portfolios formed from special funds recognized by financial management departments [3][29]. Group 2: Custody Responsibilities - Commercial banks are required to provide services such as account opening, asset custody, clearing and settlement, accounting, asset valuation, information disclosure, and investment supervision for custody products [5][31]. - A custody contract must be signed, detailing the rights and obligations of all parties, and ensuring compliance and clarity in terms [5][31]. - Banks must evaluate the capital strength, governance, compliance management, risk control, and market influence of product managers before providing custody services [6][31]. Group 3: Management Requirements - Commercial banks must establish a governance structure for custody business, ensuring that the board and senior management are responsible for custody operations [43]. - A risk management system must be in place that is commensurate with the scale and complexity of the custody business [43]. - Banks are required to maintain a separation of custody business from other operations to prevent conflicts of interest [45]. Group 4: Prohibited Practices - Commercial banks are prohibited from managing custody products that are on the negative list, which includes products established illegally or managed by unqualified managers [20][48]. - Banks must not mix custody assets with their own or with other custody products, nor engage in the misappropriation of custody assets [37][48]. - The measures also prohibit banks from providing guarantees or liquidity support for custody products [37][48]. Group 5: Supervision and Legal Responsibilities - The National Financial Supervision Administration will strengthen ongoing supervision of custody business and can impose corrective measures on banks that do not meet the required standards [41][42]. - Banks must report significant matters related to custody business to the National Financial Supervision Administration in a timely manner [45][52]. - Violations of these measures can lead to penalties, including the suspension of related business activities [42][43].