London to become an offshore RMB centre By PBI Editorial 08 SEPT 2011 London could be in line to become an offshore trading centre for the Chinese renminbi (RMB), media reports suggest. The UK Chancellor of the Exchequer George Osborne and Chinese vice-premier minister Wang Qishan are expected to discuss the growth of RMB trading in London at a meeting in the UKâ€™s capital, according to the Financial Times. Treasury officials are yet to respond to PBIâ€™s enquiry for more information on discussions. Big boost for UK industry The ability to trade RMB would be a major coup for London as a financial centre as it would give private banks and wealth managers the ability to invest in the rapidly appreciating Chinese currency on behalf of their clients without needing a physical base in Asia. Many private banks, including Barclays Wealth, DBS, HSBC Private Bank, OCBC, are already offering RMB products and services. Currently, Hong Kong is the only RMB licensed offshore trading centre. According to the latest Hong Kong Monetary Authority monthly statistical data, RMB deposits in Hong Kong climbed by 3.4% to RMB572.2bn ($70bn) at the end of July. London to beat out Singapore? In June, Chinaâ€™s CITIC Bank predicted Singapore was poised to become the second offshore RMB centre after Hong Kong. CITICâ€™s China Banking Group chief economist/strategist Liao Qun said the second phase of RMB internationalisation, following Hong Kong and Macau, was likely to happen in the Association of Southeast Asian Nations region. Meanwhile, the Securities and Futures Commission (SFC), Hong Kongâ€™s securities regulator, said it is ready to authorise retail fund products managed by holders of Renminbi Qualified Foreign Institutional Investors (RQFII) quotas. New foreign direct investment measures are in place permitting RMB raised or borrowed in Hong Kong to flow into the Mainland for direct investment. The RQFII quota has been set at RMB20bn.