Recently, a shipping company in Hong Kong has obtained 135 million yuan loans from the Export-Import Bank of China Ningbo Branch, initiating the first cross-border RMB loans in Ningbo.
In November 2011, the Export-Import Bank of China Ningbo Branch signed a RMB loan contract with the Hong Kong shipping company. The loans, taking the form of export buyer’s credit, shall be used to pay a Ningbo shipbuilder. In December 2011 and January 2012, the bank has issued 101 million yuan and 34 million yuan loans respectively to the Hong Kong shipping company.
The major cross-border RMB loan enables buyers and sellers to avoid the losses they might otherwise have incurred due to exchange rate changes. In addition, it opens a new financing channel for overseas buyers.
It is learned that the People’s Bank released guidance of RMB loans of overseas projects in October 2011, clarifying the specific procedures of the cross-border RMB loans. The experts believe that the cross-border RMB loans service not only promotes the internationalization of the RMB but also offers more support to foreign trade enterprises in Ningbo.
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