(15 February 2018 – Global) The People’s Bank of China (PBOC) has appointed JPMorgan Chase Bank NA as a yuan clearing bank in the United States (US), the first non-Chinese lender for such a role globally and a further step to promote international use of the currency.
The arrangement is made in conjunction with the US Federal Reserve, according to a statement posted on the People’s Bank of China.
Bank of China Ltd.’s New York branch already conducts such business in the US. and other Chinese lenders clear yuan payments in a number of countries.
Despite China’s aim to internationalise the yuan, its popularity has faltered amid continuing capital controls to keep money from flowing out of the country. According to data from SWIFT, global transactions using the currency fell to 1.54 percent in December 2017, a significant drop from highs of 2.79 percent two years prior.
In 2017, JPMorgan also became the first US lender to win approval to underwrite corporate bond sales in China’s interbank market.