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Taiwan banks' branches in HK, Kowloon may operate RMB-based financial businesses.

Taipei, Sept. 30, 2009 (CENS)--Governor Perng Fai-nan of Taiwan's central bank governor recently disclosed that People's Bank of China (PBC) has agreed to allow its Hong Kong branch to sign settlement agreements with 19 Taiwanese counterparts in Hong Kong and Kowloon for operating Renminbi (RMB)-based financial businesses.

Currently there are a total of 17 branches established in Hong Kong by Taiwanese banks, mainly government-linked banks including Bank of Taiwan, Land Bank of Taiwan, First Commercial Bank, Hua Nan Commercial Bank and Changhwa Bank. Besides, two branches are set up in Kowloon by two private Taiwanese banks--Chinatrust Commercial Bank and SinoPac Bank.

Perng emphasized that the central bank has to solve the currency exchange problem between the two sides first and then set up clearing system acceptable to both sides.

The above-mentioned 19 branches in Hong Kong and Kowloon are reportedly to ink the agreement respectively with PBC, and will then be allowed to handle RMB-based financial businesses, including deposits, remittance, and currency exchange, but not lending.

Chang Hwa Bank and First Commercial Bank estimated that their branches in Hong Kong might start running RMB-based business no later than the end of this year.

((JL)) (GE)

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Title Annotation:People's Bank of China, Hong Kong
Publication:The Taiwan Economic News
Article Type:Brief article
Geographic Code:9TAIW
Date:Sep 30, 2009
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