Forex service plan for Shanghai bank
THE Bank of China's Shanghai branch is to launch foreign exchange services for individual customers.
The move will provide an outlet for Shanghai residents to exchange foreign currencies, even though they are not allowed direct access to swap markets which are open only to businesses.
The service, believed to be the first of its kind offered by the banking sector in the city, will cover exchange between the US dollar, sterling, deutschemark, yen, and Hong Kong dollar, according to reports in pro-Beijing newspapers.
It is understood the service will not include yuan dealing.
The minimum transaction size would be US$500 or its equivalent, and the exchange rates would be quoted with reference to international financial markets, said the reports.
The service will be open to customers holding an identity card and a foreign currency account with the bank, or with foreign cash.
A banker in Shanghai interpreted the move as an attempt to clamp down on the city's foreign exchange black markets.
''I think the bank aims at hitting the black markets by offering a proper channel for such transactions,'' said Standard Chartered Bank's Shanghai treasury manager Chuang Kwong-yeu.
In the absence of such a service, he said, an active black market involving Shanghai citizens, businessmen and tourists had emerged.
''That will be a change for the better. At least people will have a proper way to exchange foreign currencies,'' he added.
Mr Chuang said he hoped the Chinese authorities would allow foreign banks in the city to operate the same kind of business.