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People's Daily Online>>China Business

London aims to be a yuan center

(China Daily)

08:43, April 19, 2012

George Osborne, British chancellor of the exchequer, announced an initiative on Wednesday that reaffirms his support of London becoming an offshore yuan center.

That came as the banking and financial services company HSBC Holdings Plc introduced the first yuan-denominated bond to be offered in London.

Meanwhile, the City of London Corp, which governs an area in central London, published a report showing that 109 billion yuan ($17.3 billion) worth of customer and interbank yuan deposits were held in the city at the end of December.

"This is a significant moment," Osborne said as he introduced a policy named "London as a center for offshore renminbi business".

"This builds on the progress London has already made toward becoming the Western hub for renminbi.

"Today's event emphasizes that we are not prepared to let anyone steal a march on us in terms of new products and new markets. We are the natural home in the West for those who want to invest in China's economic success story."

Osborne's comments came after HSBC announced the introduction of a 3-year yuan bond.

HSBC's term sheet for the bond issuance implied it was worth at least 500 million yuan, Reuters has reported.

The proposed issuance comes amid reforms Beijing has made to advance its plans to make the yuan an international currency. London is working to make itself into a center for offshore yuan trade following an agreement that was reached between Britain and China last year.

During a trip Osborne made in January to Hong Kong, the Hong Kong Monetary Authority and UK Treasury announced the establishment of a forum whose main topic of discussion will be the possibility of enabling London to use Hong Kong's clearing and settlement system. The forum is to hold its first meeting in May.

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