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ICBC Facilitates RMB Internationalization

ICBC Singapore RMB Clearing Bank and ICBC (Asia) has successfully launched the direct participation function of Cross-border Interbank Payment System (CIPS), becoming the first direct participant among overseas RMB clearing banks and overseas non-RMB clearing banks in CIPS respectively. On October 19, they completed their first overseas direct participation business in CIPS, marking a new step of ICBC in supporting the global network building of CIPS, promoting the bidirectional opening-up of financial markets, and facilitating the internationalization of RMB, that will helps it better serve Chinese and foreign exhibitors of China International Import Expo.

Since the People’s Bank of China first launched CIPS in October 2015, the system has become an important financial market infrastructure of China. With service network covering more than 160 countries and regions, CIPS helps to centralize clearing operations, shorten clearing paths, and provide safe and efficient funds clearing and settlement services for cross-border RMB business of global financial institutions. As one of the first direct participants in the system, ICBC has been continuously expanding its overseas network coverage in CIPS by utilizing its FinTech advantages and global network layout. At present, the bank has ICBC Head Office and ICBC Singapore RMB Clearing Bank and ICBC (Asia) as direct participants in CIPS, and nearly 100 institutions as indirect participants via ICBC, which effectively promotes the interconnect of financial markets at home and abroad, and cross-border circulation of RMB.

In terms of RMB clearing services, ICBC, as the largest commercial bank in the world in aspect of RMB business, has built a world-leading cross-border RMB business system covering the full chain, full product line and full life cycle, and took the lead to provide around-the-clock RMB clearing services globally. Currently, ICBC acts as a RMB clearing bank in seven countries, including Singapore, Luxembourg and Canada, and makes its RMB clearing network cover nearly 90 countries and regions around the world by cooperating with 1,500 correspondent banks, with a cumulative volume of nearly RMB340 trillion in RMB clearing.

In developing the offshore RMB market, ICBC has actively promoted RMB-denominated pricing, settlement, investment and financing in the areas of commodity trading and foreign contracted projects, helping to enhance the recognition and use of RMB abroad. For example, ICBC successfully facilitated the inclusion of RMB into Nigeria’s foreign exchange reserves, the first RMB-denominated energy commodity transaction in Kazakhstan, the legitimate use of RMB in Myanmar, and the innovative establishment of a closed-loop RMB cross-border circulation model in Thailand, Malaysia, Laos and other countries along the Belt and Road.

In actively promoting capital project innovation, ICBC has kept pace with the high-level opening up of China to the world and provided comprehensive supporting financial services to help global customers invest in Chinese capital markets through multiple channels like QFII/RQFII, direct investment and Bond Connect. For example, ICBC successfully acted as the custodian bank for the first GDR domestic underlying securities under the Shanghai-London Stock Connect, and managed the first batch of pilot QDII funds under the “Japan-China ETF Connectivity”, ranking first among banks in terms of the number of funds under custody and the size of the funds raised.