MNB signed the Memorandum of Understanding on RMB clearing arrangements and the Agency Agreement with People’s Bank of China in Basel

On June 27, 2015, the People’s Bank of China (PBC) and the Magyar Nemzeti Bank (MNB) signed the Memorandum of Understanding (MOU) on the establishment of RMB clearing arrangements in Hungary, and the Agency Agreement for PBC to Manage MNB’s Investment on China’s Interbank Bond Market. The PBC also decided to extend the pilot scheme of RMB Qualified Foreign Institutional Investors (RQFII) to Hungary with a total investment quota of 50 billion yuan. Later on, a RMB clearing bank will be designated in Hungary by the PBC.

By signing the MOU on RMB clearing arrangements the People’s Bank of China and Magyar Nemzeti Bank agreed to coordinate and cooperate on supervision and oversight of the RMB business, information exchange, and assessment and improvement of the system.

The signing of the Agency Agreement reflects the MNB’s confidence in the Chinese economy and financial market development. The investment in China’s bond market will help the MNB diversify investment portfolio and strengthen liquidity management, and further strengthen the cooperation between China and Hungary.

The agreements and the extension of the RQFII scheme to Hungary will promote the implementation of the MNB’s Renminbi Program by supporting the use of RMB in cross-border transactions by enterprises and financial institutions in China and Hungary, and further facilitating bilateral trade and investment liberalization.