Taiwan’s Financial Supervisory Commission (FSC) is seeking to expand the range of the RMB derivatives business for domestic designated banking units (DBUs).
The move is designed to promote the offshore RMB market on the island-state, according to a report from China Times.
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Chang Kuo-ming, deputy director general of banking at the FSC told Asia Asset Management that the first phase of RMB derivatives were single-layered and designed to link with interest rates or currency exchange.
The second phase of RMB derivative products will be multi-layered to integrate currency, interest rates, ETFs, and Formosa bonds, the non-new Taiwan dollar-denominated bonds issued in Taiwan.
The FSC is working with the Central Bank of Taiwan to implement the second phase in order to accommodate RMB product demand from local lenders.
Chang added that the FSC has introduced the regulations to allow RMB derivatives early this year.
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By GlobalDataThe breakthrough of DBUs came after Taiwan implemented RMB liberalisation in late 2012, which meant DBUs could help customers to deposit and withdraw RMB at domestic banks and post offices.
RMB deposits in 61 DBUs had reached RMB54.45 billion (US$8.6 billion) by the end of August.
