WELLINGTON - One of China's big four commercial banks is giving New Zealand dairy giant Fonterra a funding facility valued at 1.5 billion yuan ($216.27 million) so it can grow its business in China.

Bank of China New Zealand said Thursday it had signed a landmark agreement with farmer-owned cooperative Fonterra for a multi-currency bank facility, including a Chinese currency component.

Chief executive David Lei Wang said annual trade between New Zealand and China had almost tripled to NZ$23 billion ($16.33 billion) since the bilateral free trade agreement was signed in 2008, and Chinese banking services had played an important role in fostering cross-border transactions and investment.

"We see great opportunities in developing more renminbi products and tapping into China's debt capital markets on behalf of New Zealand financial institutions and government agencies," Wang said in a statement.

Fonterra chief financial officer Lukas Paravicini said the new debt facility underlined the cooperative's continued focus on building an integrated business in China.

"Bank of China has strong liquidity in renminbi and its local presence and knowledge offer us additional benefits in the rapidly developing Chinese financial markets," Paravicini said in the statement.

"Having local funding arrangements is a natural extension of our activities in China."

The Bank of China facility did not mean Fonterra was taking on more debt; rather it offered the cooperative alternatives in?renminbi funding sources.

"There is no change to our existing strategy of growing our business in China. This is simply a better way to organize the funding of that strategy," said Paravicini.

Fonterra is New Zealand's largest company and the world's largest exporter of dairy products.

It has three dairy farm centers in China and is aiming to produce 1 billion liters of fresh milk a year by 2018.