RMB Deposits at Taiwanese OBUs Hit Record 16 B. as of July

Taipei, Sept. 6, 2012 (CENS)--Renminbi (RMB) deposits held by offshore banking units (OBUs) of Taiwanese banks increased RMB 235 million from a month earlier to RMB 16.096 billion at the end of July, the highest on record, according to Taiwan's central bank.

Following the inking of the currency settlement agreement between Taiwan and China late last week, F. N. Perng, governor of the central bank, and Y. C. Chen, chairman of Financial Supervisory Commission (FSC), agreed to allow inter-OBU RMB lending.

Insiders say that until recently the financial institutions in Hong Kong dominated RMB transactions for most Taiwanese banks put such deposits in their Hong Kong branches and/or Chinese agent or correspondent banks in Hong Kong, a trend that will change with the agreement as Taiwanese banks will be allowed to handle RMB transactions in Taiwan.

Taiwan's central bank is evaluating domestic banks to choose one to handle RMB settlement, and will in the long run allow both OBUs and domestic banks directly handle RMBs in Taiwan.