Deutsche Bank Clears Path for European Yuan Transactions
Deutsche Bank has become the first European institution to be authorized by China's central bank as a clearing bank for the Chinese currency, the renminbi (RMB).
This decision was made in accordance with an agreement between Germany's central bank and the People's Bank of China (PBOC), which designates Deutsche Bank to act as a RMB settlement bank in Frankfurt.
As a clearing bank, also known as a settlement bank, Deutsche Bank will be responsible for processing and finalizing cross-border transactions, which are essential to international trade. The PBOC has been seeking to increase the use of the RMB worldwide, reducing global dependence on the US dollar.
Deutsche Bank's head for Asia-Pacific, Europe, the Middle East, Africa and Germany, Alexander von zur Muehlen, stated that this initiative 'will strengthen the financial connection between China and Europe.'