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June. 2014
Development of Cross-border RMB Business
The Internationalization of the RMB
Table of Contents
1. Introduction of ICBC and ICBC Singapore Branch
2. The RMB Internationalization
3. Services of the RMB clearing bank
4. Why partner ICBC
1. Introduction of ICBC and ICBC Singapore Branch
Strictly Confidential 5
ICBC is considered one of the best banks in the world
The largest bank in terms of
deposit
The most profitable bank in
terms of net income
Sources: Bloomberg, Global Bank Ranking
No.1The largest bank in terms of
market cap
Global Finance
“Best Integrated Corporate Bank Site-Global”
“Best Integrated Corporate Bank Site In Asia”
“Best Bank in China”
“Best Trade Finance Bank in China”
Finance Asia
“Best Bank in China”
“Best Investor Relations”
“Best Cash Management Bank”
The Asset
“Platinum Award for ALL-Round Excellence”
“No.1 China’s Most Promising Companies
(Banking & Finance)”
The No.1 The Global BankThe Best in Class
No.1 No.1
US$ bn US$ bnUS$ tn
As of 31/3/2013 As of 31/12/2012 LTM 31/12/2012
Securities Times
“Best Investment Bank (China)”
ICBC is the World’s Largest and Most
Profitable Bank
Strictly Confidential 6
Over 17,613 branches in China
383 overseas branches in 39 countries and regions
around the world
Connection with over 1,771 foreign banks in over 138
countries and regions
Over 4.38 million corporate customers and
approximately 393 million retail customers across the
world
Solid client base established through continuous
business expansion globally
Became the single
largest shareholder
of Standard Bank,
the largest bank in
South of Africa - the
most significant
overseas investment
Established
presence in Sydney,
New York, Middle
East, Doha
Acquired Seng Heng
Bank, Macau
1992,1995
London -
the first
presence
in Europe
Established
ICBC-BEA
Finance
Holding Co.
Ltd
1998
Acquired
Union bank
and
subsequently
renamed to
ICBC (Asia)
Listed in
Shanghai and
Hong Kong
Signed Strategic
Investment and
Cooperation
Agreement with
Goldman Sachs,
Allianz Group
and American
Express
2006
Entered
Indonesia
through
acquiring 90%
of Halim Bank
Established
ICBC
(Moscow)
20072000
Acquired Bank of
East Asia
(Canada)
Acquired
Thailand’s ACL
Bank PCL
Opened
branches in
Macau, Hanoi,
Abu Dhabi
Established ICBC
(Malaysia)
Setting up a
Brazilian branch
20092008
Singapore -
the very first
footprint
abroad
Accelerated since 2008
Growing Global Presence
Extensive global network
Accelerated pace of international expansion
Officially renamed
ACL Bank PCL as
ICBC (Thai) PCL
Extending the tier-2
network overseas
including the Red
Market Branch of
ICBC Macau, Deli
Branch of ICBC
Korea Branch, South
District Branch in
Jakarta of ICBC
Indonesia
2010
TokyoSeoul
Busan
Vancouver
Toronto
New York
MacauHong Kong
Jakarta
Kuala LumpurSingapore
Standard Bank,
Johannesburg
Almaty
Hanoi
MoscowLondon
FrankfurtLuxemburg
DohaAbu Dhabi
Dubai
Sydney
ACL Bank,
Bangkok
Islamabad
Mumbai
ParisBrussels
Madrid
Amsterdam
Milan
Opened branches
in Paris, Brussels,
Amsterdam, Milan
and Madrid
ICBC (Luxemburg)
renamed as ICBC
(Europe)
Announced
acquisition of
Standard Bank
Argentina
2011 2012
Opened branches
in Warsaw and
Barcelona
Increased stake in
Standard Bank
Argentina to 80%
ICBC Peru Branch
was officially
established
ICBC purchased
The Bank of East
Asia (USA), and
named it ICBC
America
2013
ICBC was
approved to be a
RMB Clearing
Bank in
Singapore
ICBC Brazil was
set up
Acquires 20%
stake in Taiwan’s
Bank Sinopac
Argentina
Sao Paulo
Strictly Confidential 7
ICBC Singapore Branch was established in November 1993, the first overseas branch of ICBC.
Awarded Qualifying Full Bank (QFB) licence in October 2012 .
The first offshore RMB Clearing Bank outside Greater China,designated by the People's Bank of China on Feb 8 2013 .
Issued 2 billion yuan (328 million US dollars) "Lion City" bonds, representing the biggest RMB-denominated bond issue so far in the Singapore market in Nov 2013.
Carried out the first FTZ RMB two-way cross-border cash pooling in Dec 2013 (100 million yuan for Bao Steel).
On 20 Feb 2014, Provided Rmb100m and Rmb70m, respectively, to Sinopharm Holding Distribution and Shanghai Baosteel Pudong International Trade – the first cross-border RMB financing between Singapore and Shanghai FTZ. Transactions were remitted through the same day via RMB Clearing Bank even though CNAP closes at 5pm.
By the end of June 2014, the total clearing amount exceeded 17 trillion yuan, and the peak daily clearing value reached nearly 300 billion yuan.
To date 77 Participating Banks all over the world have opened RMB accounts with the Clearing Bank and more are in the pipeline.
ICBC Singapore Branch: History &Timeline
Strictly Confidential 8
2. The RMB Internationalization
Strictly Confidential 9
World’s 2nd largest economy with GDP over US$8 trillion in 2013.
China surpassed US as largest trading nation in the world with trade flow of almost US$4 trillion
Largest foreign reserve holding of more than $3.8 trillion as at end 2013.
China’s trade with the world will drive
RMB Internationalization
Strictly Confidential 10
RMB overtook 22 currencies in the last 3 years
Strictly Confidential 11
RMB rising in importance as global trade
settlement and payment currency
Currently China had signed currency swap contracts with 24 countries and regions with the scale of 2.5 trillion RMB.
In April 2014, RMB held its position as the seventh-ranked global payments currency and accounted for 1.43% of global payments.
In October 2013, RMB became the second most used currency in trade finance, overtaking the Euro.
Strictly Confidential 12
Singapore pips London as RMB clearing
center helped by ICBC
Ever since last year's nomination of ICBC as the RMB clearing bank in Singapore, the Singapore RMB payment flows have been accelerating.
According to SWIFT data, the value of Singapore's RMB payments in March rose 375 percent from a year earlier, taking up 6.8 percent of the overall RMB payments. Singapore has surpassed London to rank second globally as a clearing center for RMB.
Strictly Confidential 13
Investment Global ReservesTrade
The route of RMB internationalization
Strictly Confidential 14
Beijing
- Exporting to China
-RMB financing from
China
- RODI from China
-RMB purchase
- Currency Swap
-Importing from
China
-RFDI to China
-Deposit in Clearing Bank
or via Non-Resident
account
-Investment in China
inter-bank bond market
- RQFII - Issue offshore
bond
Flowing out of
China
Flowing back into
China
Channel of Cross-border RMB
3. Services of the RMB clearing bank
Services Provided By Clearing Bank
• RMB clearing & settlement
• RMB deposits
• RMB FX conversion & money market & bond
• Intra day liquidity support
• RMB banknotes
• Collateralized liquidity facilitiest (in progress).
ICBC RMB Clearing Bank Services
ICBC SGCNAPS Code:
102100099988
SWIFT Code:ICBKSGSGCLR
Receiving Bank
ICBC HO
Participant ICBC SG
ICBC (Asia)UBHKHKHH
ICBC group as correspondent bank
Banks in China(Non-ICBC)
ICBC Group
Banks in Hong Kong
Banks in the related region
MT103/202
CNAPS
ICBCGSCP
ICBCGSCP
SWIFT
RTGS
Payment Route
Book transfer
Clearing Days
Singapore 1Mainland China 2Hongkong Whether clearing services provided
1 Business day Business day Business day Yes
2 Public Holiday Business day Business day *Yes
3 Public Holiday Public Holiday Business day *Yes
4 Public Holiday Business day Public Holiday *Yes
5 Public Holiday Public Holiday Public Holiday No
1 No clearing services will be provided for payment to or from mainland China if that day is a public holiday in mainland China.2 No clearing services will be provided for payment to or from Hong Kong if that day is a public holiday in Hong Kong.
Straight-Through-Processing(STP)
Taiwan
0830-2230* 0830-1645
Hong Kong-RTGS
China-CNAPS
24h
Book Transfer
Non Straight-Through-Processing(non-STP)
Taiwan
0830-2200* 0830-1630
Hong Kong-RTGS
China-CNAPS
0830-2330*
Book Transfer
Clearing Hours
Value: RMB 100 million
Clearing Value & Volume
1066.00 1438.28 2178.90 3837.70 4509.21
5919.49 6932.61
17730.57
24113.17
27394.97
21952.23
24557.53
29667.31
2230 2464 29064730
64858480
10748
22392
28487
44306
31835
39688
43561
0
10000
20000
30000
40000
50000
60000
70000
0.00
5000.00
10000.00
15000.00
20000.00
25000.00
30000.00
35000.00
40000.00
45000.00
50000.00
Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14
Value Volume Expon. (Value) Expon. (Volume)
Strictly Confidential 21
4. Why partner ICBC
Strictly Confidential 22
Why partner ICBC
System capabilities - Centralised clearing platform
• Real time information sharing
• Automated conversion between CNAPS & SWIFT messages
• Automated selection of most efficient payment route
• Support 7*24 hours processing for straight through payment
• Longest clearing servicing hours for payment to mainland China
• Speedy, efficient straight through processing of payments
Strictly Confidential 23
Expertise
• Experienced & dedicated RMB clearing operation team based in Head Office working hand in hand with local operation team to ensure high quality service provided to participants.
Competitive pricing
• World’s Largest Bank in terms of Customer RMB Deposits enables us to offer competitive interest rate on RMB deposit, financing cost & clearing fee thereby reducing participants’ operating costs
Why partner ICBC
Strictly Confidential 24
Liquidity
provider role
PBOC
appointed
Clearing Bank
Collaboration
with MAS
Dedicated
task force
Strong liquidity support from Head Office.
Strong support from PBOC
As RMB Clearing Bank works closely with MAS and
industry players to develop the local RMB market.
Dedicated task force to focus on ever-emerging
regulatory landscape.
Why partner ICBC
Thank you!
Disclaimer
This document is prepared by Industrial and Commercial Bank of China Limited, Singapore
branch. While we take all reasonable care in preparing this document, no responsibility or
liability is accepted for errors of fact or for any opinion expressed herein. This document is
for information purposes only and it does not constitute any offer, recommendation or
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