OREANDA-NEWS. October 14, 2014. Industrial and Commercial Bank of China Limited Luxembourg Branch (abbreviated as‘ICBC Luxembourg Branch’) has been designated as the RMB clearing bank in Luxembourg, according to an announcement made by the People’s bank of China (PBOC).

With this appointment, ICBC has its first yuan-clearing bank in Europe, and second overseas  yuan-clearing bank since its Singapore branch was authorized by PBOC as the clearing bank of RMB business in Singapore last year. The appionment also marked a major step for ICBC to create a global RMB clearing network across different time zones, while enhancing the internationalization of RMB, especially the utilization of RMB in the cross-border transactions in Europe.

After being mandated as the RMB clearing bank, ICBC Luxembourg Branch promises that they will strictly fulfill the obligations to the regulatory rules under the direction of authorities of both China and Luxembourg, commit to providing safe, premium and efficient RMB clearing service relying on its advantages in business, network and services, and make contribution to further boosting bilateral economic and trade cooperation between China and Europe.

Today, Luxembourg is already one of the most important hubs for cross-border RMB business in the Eurozone, and serves as the gateway for Sino-EU trade and investment. Being the second largest fund centre in the world after the US, the largest global Euro bond listing platform and the premier private banking center in the Eurozone, Luxembourg has a remarkable expertise in financial services. As one of the few remaining European countries with an AAA rating, Luxembourg also offers a stable political and economical environment for the development of financial industry.

In terms of RMB business, Luxembourg has the largest RMBcash pool in the Eurozone with RMB79.4 billion in deposits and RMB73 billion in loans until the end of Q1 2014, It is also the leading registration place for RMB investment funds in Europe. The RMB investment funds domiciled in Luxembourg has managed yuan-dominated assets over RMB261.8 billion. Luxembourg is home to Clearstream, the principal European supplier of post-trading services. The volume of RMBsecurites cleared in Q1 2014 reached RMB408 Billion. According to SWIFT, the Society for Worldwide Interbank Financial Telecommunication, Luxembourg ranks second in RMB payments in Europe. According to the Ministry of Commerce of the People’s Republic of China, Luxembourg is the main recipient of Chinese FDI into Europe, and its strength in air freight services makes it a strategic centre for logistical services. As a result, the establishment of RMB clearing bank in Luxembourg will benefit both Chinese and Luxembourgish companies and financial institutions in trade and investment through its effective and comprehensive RMB services.

ICBC Luxembourg Branch, established in 1999, along with Industrial and Commercial Bank of China (Europe) S.A.(abbreviated as ICBC (Europe) S.A.), are both operating institutions that share the same team and supplement each other with advantages of different banking licenses. With Luxembourg as its hub, the Bank also reaches out its customers across the continent, by interacting closely with its institutions in Paris, Amsterdam, Brussels, Milan, Madrid, Barcelona, Warsaw and Lisbon. ICBC Luxembourg Branch has been tapping the group advantages and regional resources, and actively providing comprehensive financial services for customers on the local market or from China. Over the years, the overall competitiveness and sustainability have been substantially improved, making it the most rapidly-growing Chinese commercial bank in the European region.In recent years, the bank has seized the strategic opportunity to accelerate the development of cross-border RMB business through the launch of a full range of RMB products and services, covering account service, settlement, deposit, loans, trade finance, cash management, asset management and bond market service, etc.