The Australian Securities Exchange (ASX) and the Bank of China have signed an agreement to continue and expand their strategic cooperation in developing the renminbi (RMB) in Australia’s financial markets.
In the latest stage of their partnership, both parties committed to exploring opportunities to increase the use of RMB in Australian markets. Plans include marketing RMB services to customers and running educational seminars, as well as facilitating issuance of financial products denominated in RMB.
They will also promote ASX in the Chinese and Asian markets as a place to raise equity capital in Australian dollars and, potentially, for RMB in the future.
The announcement came at the same time as the appointment of the Bank of China as the official RMB clearing bank in Australia, as chosen by the China’s central bank, the People’s Bank of China.
“The appointment of the Bank of China as the RMB clearing bank for Australia supports the development of Australia as a financial hub for RMB in the Asia Pacific and deepens the Australia-China economic relationship. ASX congratulates the Reserve Bank of Australia and the People’s Bank of China for reaching this milestone,” said Elmer Funke Kupper, managing director and CEO of ASX.
He added: “It will enable us to explore the full potential of the RMB in Australia’s trade relationship with China and in our domestic financial markets. This could include the development of RMB-denominated bonds and derivatives that can be quoted and traded on ASX. It will also improve the attractiveness of Australia as a listings location for Chinese companies.”
Tian Guoli, Chairman of Bank of China, said: “The Bank of China attaches great importance to the development of Sydney as an offshore RMB centre. China is Australia’s biggest trading partner and Australia is one of China’s largest investment destinations. The expanded cooperation between the Bank of China and ASX will facilitate cross-border RMB investment and financing by business, and promote Sino-Australian trade and economic links.”
“The Bank of China is ranked number one globally in cross-border RMB clearing. By the end of the September quarter 2014, we had conducted more than 173 trillion RMB cross-border payments. This is the first time in the southern hemisphere that the Bank of China has been appointed the clearing bank for RMB business. This week’s positive developments will further promote the internationalisation of the RMB in Australia.”
The agreement was signed in Canberra, with Australian Prime Minister Tony Abbott and President of the People’s Republic of China Xi Jinping in attendance.
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