Bank of China opens yuan center
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E-mail China Daily, March 21, 2012
Bank of China Ltd on Tuesday unveiled a trading headquarters in Shanghai that will oversee the bank's yuan asset trading business.
The China Banking Regulatory Commission has authorized the second headquarters to conduct business in the proprietary trading of yuan-denominated bonds, money market instruments and precious metals as well as financial institutions-related business, the bank said in a statement.
The launch of the new office, which was in the works for two years, is part of the Chinese government's effort to support Shanghai's ambition to become a global financial hub.
Shanghai has set a goal of becoming a global clearing center for yuan-denominated financial products by 2015 and a global financial center by 2020.
Major domestic financial institutions and national financial regulators have their headquarters in Beijing, a situation that analysts said has blocked Shanghai's drive to become a financial center.
Shanghai has the largest number of foreign banks and the biggest non-bank financial industry in China.
Besides Bank of China, the other "Big Four" State-owned banks - Industrial & Commercial Bank of China Ltd, Agricultural Bank of China Ltd and China Construction Bank Corp - also plan to set up second headquarters in Shanghai.
Bank of China's move "is a milestone in the city's plan to become an international financial center", Shanghai Mayor Han Zheng told the Xinhua News Agency.
Bank of China Chairman Xiao Gang said: "Setting up a yuan trading headquarters in Shanghai is an important measure for the bank to ... quicken its strategic development in Shanghai".
Bank of China is a leader among domestic banks in yuan and precious metals trading. Last year, the bank's cross-border yuan clearance and settlement business hit 1.7 trillion yuan ($269 billion), the highest among Chinese banks.
Nasser Saidi, chief economist of the Dubai International Financial Center, said the move signals Shanghai's future role as the country's main financial center. He added that the Shanghai Stock Exchange will become an international bourse "very quickly".
The Shanghai Evening Post has reported that the new headquarters will be on the same administrative level as the Bank of China's Shanghai branch.
The bank's existing capital exchange center and information center in Shanghai will be merged into the new headquarters, according to the newspaper.
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