China's central bank chief has reacted positively to a Hong Kong government proposal that local lenders be allowed to expand their yuan business, according to Secretary for Financial Services and the Treasury Frederick Ma Si-hang. Mr Ma, who was in Beijing to give the keynote speech in the World Exchanges Forum yesterday, met People's Bank of China governor Zhou Xiaochuan to discuss the proposal. Since February last year, Hong Kong banks have been allowed to conduct four types of yuan business for individuals - remittance, exchange, deposit and credit card. But Financial Secretary Henry Tang Ying-yen would like to see it expanded to doing business in yuan-denominated bonds and providing two-way exchange services for corporate clients. 'Mr Zhou reacted positively to the proposals,' Mr Ma said, but added that Mr Zhou did not give any timetable for the expansion. Mr Ma also met National Social Security Fund president Xiang Huaicheng to discuss the long-awaited investment by China's pension and social welfare fund in Hong Kong and other overseas markets that was approved by the State Council in February last year. Despite the delay, Mr Ma quoted Mr Xiang as saying the plan was proceeding smoothly.