HSBC completes renminbi trade settlement in Brazil

The lender has settled in RMB across six continents with the deal in the South American country.

HSBC on Thursday announced the completion of its first renminbi (RMB) denominated trade settlement transaction in South America. The ground-breaking transaction took place in Brazil for Groupo Tellerina, a retailer of house and decoration products. In settling this transaction, HSBC stands as the leading bank globally offering customers RMB trade settlement services in Asia Pacific, Europe, Australasia, Africa, North America and South America.

HSBC’s market setting RMB-denominated transaction in South America demonstrates China’s growing economic influence globally and the evolving demand for the RMB as a settlement currency across all continents, according to an HSBC report.

Peter Wong, HSBC’s Chief Executive Officer for Asia Pacific, said: “China’s position within the global economy is developing rapidly and its growing influence is undeniable. We estimate that annual trade flows will cross USD2 trillion within in five years, easily positioning the RMB as one of the top three currencies used in global trade. As the RMB becomes a major settlement currency, our global connectivity and unrivaled RMB experience provides customers with a significant advantage.”

Ms. Tan Siew Meng, Head of Commercial Banking of HSBC Singapore, said: “This latest landmark deal clearly demonstrates HSBC’s capacity to facilitate international business. As trade with China continues to grow in importance for many of our customers in Singapore and with their keen interest to explore further opportunities to grow their businesses in China, we foresee an increase in their demand for RMB settlements. With HSBC’s global network and expertise in trade finance, we are well positioned to assist our customers across the region, including Singapore to grow their international trade business with China as RMB business becomes a global reality.”

“In Singapore, HSBC offers a wide range of RMB services, including two-way exchange between RMB and the Singapore dollar and other foreign currencies, as well as outward and inward remittances for imports and exports made with designated enterprises in China. In addition to this, we also have RMB capabilities in all of China’s top 20 trading partners, and will continue to widen our scope to facilitate RMB-based remittances and Documentary Credits transactions in more countries and territories. Going forward, we will continue to roll out RMB services to both corporate and institutional customers in more countries worldwide,” added Ms. Tan.

Following the expansion of the RMB trade settlement programme by the Chinese government in June 2010, HSBC has actively supported the internationalisation of China’s currency, extending its RMB capabilities to 32 markets across six continents.