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China's central bank further opens up overseas yuan business

The People's Bank of China has allowed overseas yuan clearing banks to conduct more business, including interbank borrowing and cross-border account financing.

The Chinese central bank said May 18 that to further open up China's financial markets, overseas yuan clearing banks and overseas yuan business participating banks are now allowed to carry out interbank borrowing, cross-border account financing and bond repurchases businesses under the current policy framework.

Yuan clearing banks in Hong Kong and Macau will no longer be required to hold deposit reserves at the central bank's Shenzhen and Zhuhai branches, respectively.

In addition, the central bank said foreign investors that participate in the Shanghai-Hong Kong and Shenzhen-Hong Kong stock connect programs can exchange foreign currency and engage in foreign exchange risk hedging at Hong Kong's yuan clearing banks through securities companies and brokers.