China central bank publishes rules to support cross-border yuan lending

China’s central bank published rules on Thursday to regulate and support cross-border yuan financing businesses, as part of efforts to promote the global use of the Chinese currency.

The move will standardise the management of cross-border interbank yuan financing, which is “conducive to the smooth and stable supply of offshore yuan liquidity”, the People’s Bank of China said in a statement.

Under the rules, which cover various types of yuan-based funding activities between domestic banks and overseas entities, the size of a domestic bank’s cross-border lending business will be pegged to its capital strength.

The rules encourage domestic banks to conduct cross-border yuan lending, part of broader efforts toward yuan internationalisation.

Reuters