Banks to promote internationalization of renminbi

China's banking industry is expected to better tap into the opportunities presented by the ongoing reconstruction of the international monetary system to promote the internationalization of the renminbi, according to a recent report released by the China Banking Association.

To promote cross-border renminbi business, the report suggested commercial banks better leverage the capabilities of State-owned enterprises and multinational companies, strengthen cooperation with bulk commodity traders to promote use of the renminbi in valuation and settlement of bulk commodities like natural gas and oil, and increase cross-border use of the renminbi in key regions including those involved in the Belt and Road Initiative and member countries of the Regional Comprehensive Economic Partnership agreement.

Commercial banks are also suggested to improve the valuation and settlement functions of the renminbi in stocks, bonds, foreign exchange and other financial markets; attract overseas issuers to participate in the domestic bond market; expand cross-border financial cooperation; and continuously enhance their cross-border business development and risk prevention and control capabilities.

The report said commercial banks should better meet cross-border financing demand from Chinese companies going global through providing rich finical services such as various types of cross-border renminbi loans with different durations and cross-border renminbi settlement.

The report also made suggestions for the authorities to fine tune policies to strengthen internal and external communication, improve high-level trade and investment facilitation, unleash the potential of the renminbi in financing, enhance connectivity of financial markets, and promote offshore renminbi business development.