The Export-Import Bank of China (China Eximbank), a policy bank
that backs up the mainland's foreign trade, will study the renminbi
market in Hong Kong to decide whether it will issue
yuan-denominated bonds there, according to the lender's top
management.
"We will discuss and study the situation of the renminbi market
first. We will give it profound consideration before making the
decision," said Li Ruogu, chairman of China Eximbank.
The central government's approval for mainland financial
institutions to offer yuan bonds last week was a long-awaited move
that is expected to further bolster Hong Kong's role as a platform
for the yuan business.
Since the announcement there has been heightened anticipation as
to who will be the first player in Hong Kong.
Economists predicted the three policy banks China Development
Bank, Agricultural Development Bank of China and China Eximbank
could be the first batch of mainland financial institutions to
launch the business.
This is because all mainland commercial banks have a means to
tap Hong Kong's equity market, whereas fundraising channels for
policy banks are limited to capital injections from the government.
The chance to issue yuan bonds in Hong Kong will be too good an
opportunity for policy banks to miss, economists said.
But analysts are concerned that the small yuan reserve of only
20 billion in Hong Kong may not be enough to meet the urgent need
of issuers.
Li, however, said he was optimistic about the yuan market in
Hong Kong, because "any market development should be based on a
step-by-step approach, and Hong Kong is stepping in a promising
direction".
Li said he had reviewed and adjusted China Eximbank's loan
portfolio since he was appointed its chairman a year and a half
ago.
He said China Eximbank will give a favorable loan policy to
import and export businesses in the areas of high-tech, energy
efficiency and environmental protection, which are vital issues for
the nation's development.
"We will give strong support to sectors including high
technology, energy efficiency and environmental protection. We will
help to streamline their exports and at the same time encourage and
welcome their import business," said Li at a luncheon in Hong
Kong's Conrad Hotel yesterday.
Li attended the luncheon to chair the signing ceremony for a
cooperation agreement between the bank and Hong Kong-based Heung
Kong Group.
The two parties agreed to work together to provide more loans to
Taiwanese and Hong Kong investors who want to expand on the Chinese
mainland.
China Eximbank has expanded its service range in response to
growing demand for Taiwanese business groups on the mainland.
(China Daily January 18, 2007)