Two Chinese banks will be granted Qualifying Full Bank privileges in Singapore wth one of them to be also authorized as a clearing bank for Renminbi.
Singapore's Ministry of Finance did not name the two Chinese banks. It said that "implementation details will be worked out by the relevant financial agencies in Singapore and China in due course."
Currently, there are three Chinese banks operating in Singapore, including Bank of China, Industrial andCommercial Bank of China and China Construction Bank, none of which are under the license scheme of QFB.
So far, there are eight QFBs in Singapore, which have greater access to the Singapore market than othersbecause they are able to open more branches and undertake retail deposit business.
Singapore has been pursuing a global offshore yuan market for a long time, during which granting a clearing bank for Renminbi has been a topic in negotiations with China.
China will also expeditiously process all applications made by selected Singapore banks for the establishmentof branches and sub- branches in China, subject to their prudential law, regulations and rules, the ministry stated.
According to the China Banking Regulatory Commission, the selected Singaporean banks include United Overseas Bank (China) Limited, Development Bank of Singapore Co., Ltd. and Overseas-Chinese Banking Co., Ltd.
The initiatives are aimed at enhancing cooperation in banking services under the existing China-Singapore Free Trade Agreement, which was signed in 2008.
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