UOB's China unit to focus on cross-border yuan financing solutions

The China unit of United Overseas Bank (UOB) will focus on providing cross-border yuan financing solutions for its clients who do business between China and the rest of Asia, the lender said over the weekend.

UOB, which opened its newest sub-branch in China's Shanghai free trade zone on Saturday, said that it expects the use of the yuan, or renminbi (RMB), to continue expanding as China liberalises its currency further.

"Increased cross-border trade and investment between China and Asia are encouraging more companies to use the renminbi as a business and payment currency," said Mr Eric Lian, the president and chief executive officer of UOB (China).

A UOB survey conducted earlier this year found that 61 per cent of Chinese companies are planning to expand within Asia over the next 12 months, especially in South-east Asia, South Korea and Japan.

The interest is mutual: Asian companies, particularly those from Malaysia, Singapore and Thailand, said China is their top expansion destination this year.

To facilitate such trade and investment flows, UOB has developed a "comprehensive suite" of cross-burder yuan solutions that it will offer through its new Shanghai free trade zone branch, Mr Lian said.

"This will help our clients to take advantage of the efficiencies that payment and trade settlement in RMB can offer," he added.