San Francisco Mayor Edwin Lee discussed ways to make the city an offshore yuan hub in a meeting with Bank of China Ltd. executives this week, said two people with knowledge of the matter.
The Sept. 9 meeting in San Francisco also included officials from the city’s Chinese consulate and was a preliminary discussion, said the people, who asked not to be identified as the talks are private. State-owned Bank of China clears yuan transactions in Hong Kong and Taiwan, enabling companies in those locations to use the Chinese currency in trade and finance.
San Francisco would join London, Paris and Frankfurt in seeking to become centers for yuan trading, which the Bank of International Settlements said last week more than tripled globally from 2010 to 2013, making the currency the world’s ninth most-traded. China has promoted international use of the yuan as it moves to allow greater cross-border capital flows and loosen controls on exchange and interest rates.
Lee had “a very good meeting with representatives from the Bank of China,” Christine Falvey, director of communications for the mayor’s office, said by e-mail. “He regularly meets with business leaders in the banking industry to discuss investment opportunities in San Francisco,” she said, without elaborating.
Calls today to the office of Bank of China spokeswoman Zhao Rong and the lender’s news department in Beijing went unanswered.
Hong Kong, the first yuan hub set up outside China, accounted for almost 90 percent of all transactions in the currency outside the mainland last year, according to data from the city’s monetary authority.
Singapore signed a memorandum in April with China’s central bank for cooperation on the yuan business, with Industrial and Commercial Bank of China Ltd. being appointed to clear yuan transactions in the city.
Bank of China’s Taipei branch won the right to clear yuan transactions in Taiwan in December.