The Monetary Authority of Singapore (MAS) and the People's Bank of China (PBOC) yesterday announced the renewal of a bilateral currency swap arrangement for another three years. The original facility was established in 2010 and first renewed in 2013. The new arrangement is effective as of March 7.

In a statement, MAS said the swap agreement is a key pillar of cooperation with the PBOC to strengthen regional economic resilience and financial stability.

It aims to enhance banks' confidence in carrying out their business in the two markets, and enables both central banks to provide foreign currency liquidity to stabilise financial markets.

Under the arrangement, eligible financial institutions operating in Singapore can tap up to 300 billion yuan (S$63.6 billion) of liquidity.

The renewed agreement will also supplement the various initiatives announced at the 12th Joint Council for Bilateral Cooperation in October last year and the state visit to Singapore by China President Xi Jinping in November last year.