SEOUL, Nov. 6 (Korea Bizwire) — Bank of Communications held on November 6 a memorandum signing event for the opening of a won-yuan settlement bank in Seoul. Earlier in July this year, the two summits of China and Korea had agreed to a deal in which the People’s Bank of China would designate Bank of Communications as a settlement bank in Korea. At the ceremony, scores of banking industry leaders, as well as Finance Minister Choi Kyoung-hwan and Bank of Korea Governor Lee Ju-yeol, were in attendance.
In celebratory remarks in the event held at Hotel Shilla, Minister Choi said, “In circumstances where the trade surplus with China is continuing, Korean companies should take full advantage of the situation by exchanging the won directly with the Chinese yuan. The government will work to make the yuan-denominated trade payments account for more than 20 percent of all transactions.”
Bank of Korea Governor Lee also said, “With this settlement bank designation as a momentum, I hope the Chinese-Korean financial and economic ties could be strengthened further and Korea could become an offshore hub of yuan transactions. There are many tasks ahead including developing diverse yuan-based financial products and successfully forming the won-yuan direct trading market.”
Choi Soo-hyun, chairman of the Financial Supervisory Service, said, “For the past five years, China’s top-five banks have set up shop in Korea, with their assets in Korea quadrupling in three years, becoming the second largest country after the United States in terms of investment volume. From the arrangement, both countries can benefit, including savings of transaction cost and risk reduction for Korea and expansion of its currency area for China.”
NiuXiming, Bank of Communications chairman, said, “The yuan currency settlement business for Bank of Communications Seoul is one of the most important strategic issues for us. We will do everything we can to lend support to make it successful.”
By Sean Chung (email@example.com)