Investments

Lu International and Ping An Trust launch their First Offshore RMB Product

Lu International (Singapore) Financial Asset Exchange Pte. Ltd., a subsidiary of China's leading technology-empowered personal financial services platform Lufax Holding (NYSE: LU), is set to formally launch its first offshore RMB fixed-term product in partnership with Ping An Trust. The new offshore RMB product will be available on the Lu Global App.

The offshore RMB product offering is to be issued by Ping An Trust with RMB-denominated urban investment bonds as the underlying assets. At the same time, Lu International will serve as the official online distribution platform for users worldwide, Lu International said in a press release.

Commenting on the new product launch, Lu International COO Ye Tingting said, “The rising recognition of the RMB internationally and the continuous operational improvement of the offshore RMB market, has led the market share of renminbi to grow significantly. In response to this, we have taken a proactive approach to providing comprehensive asset allocation options to Lu International's global users by leveraging the high-quality assets of Ping An Trust.”

Global RMB is here

The implementation of a new dual circulation strategy in China has led to significant growth in the offshore RMB market and the internationalization of the currency.

Taking the London market as an illustration, according to public records, as of the end of May 2021, total actual receipts and payments of cross-border RMB services handled by China and the UK reached approximately 763.9 billion yuan, a significant increase of 61% over the prior-year period.

The trading volume of London's RMB foreign exchange market also maintained solid growth. Data from the Bank of England showed that during the first quarter of 2021, the average daily trading volume of offshore RMB foreign exchange in London had reached 96.8 billion pounds, up 9.01% sequentially.

While the value of deposits and loans denominated in RMB in London's offshore market was slightly lower than that recorded in the same period of last year. As of the end of the first quarter of 2021, the balance of RMB deposits in the London offshore market was approximately 72 billion yuan, an increase of 11.21% quarter-on-quarter and a slight decrease of 5.12% year-on-year.

With the implementation of China's dual circulation policy, smooth-functioning domestic and international RMB circulation will enhance the use of the currency in global markets. In this context, expanding offshore RMB asset business and enhancing offshore RMB liquidity is of great significance to the internationalisation of the RMB.