Money

Mainland, HK sign agreement for renminbi business in HK

(Xinhua)
Updated: 2010-07-20 09:32

HONG KONG - The People's Bank of China (PBOC), or the central bank, and Hong Kong's renminbi clearing bank -- Bank of China (Hong Kong) Limited (BOCHK), on Monday signed a revised?Settlement Agreement?on the Clearing of?Renminbi Business in Hong Kong.

The move is set to help the financial hub expand its business in the Chinese currency RMB.

Hu Xiaolian, deputy governor of the PBOC, and He Guangbei, vice chairman and chief executive of the BOCHK, signed the agreement as representatives of each party.

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A supplementary Memorandum of Cooperation on the expansion of the RMB trades settlement scheme was also signed on Monday by the PBOC and the Hong Kong Monetary Authority (HKMA).

Following the revision of the agreement, "there will no longer be restrictions on banks in Hong Kong in establishing renminbi accounts for and providing related services to financial institutions; and individuals and corporations will be able to conduct renminbi payments and transfers through the banks," said Norman Chan, the chief executive of the HKMA.

"I expect that many more types of financial intermediary activities denominated in the renminbi will be introduced in the market, helping Hong Kong's renminbi business platform leap to new heights," Chan said.

The PBOC, who authorized the BOCHK as the RMB clearing bank in Hong Kong in December of 2003, signed a clearing agreement with the BOCHK in relation to RMB Business in HK in July of 2009, since when the BOCHK launched RMB clearing services for trade settlement.