George Nast, global head of product for transaction banking at Standard Chartered, explained at a panel at SIBOS that they have entered into a fixed ten-year tenor RMB cross-currency swap based on the Hong Kong Interbank-Offered Rate (Hibor).

This type of swap opens up opportunities for treasury and finance to raise loans in lower interest rate currencies offshore from China. The company can then swap the funds into offshore RMB in Hong Kong and loan them into China for a net lower cost than raising the funding in China RMB market. For many companies expanding their operations in China such long-term swaps are essential.

No wonder that RMB is being used increasingly in international trade.