Citi Global Transaction Services Expands Business Focus to Banks in California
Los Angeles, New York - May 12, 2011 – Citi’s Banks Services Group, a unit within Global Transaction Services, is expanding its business focus to banks in California that have increasingly close business ties to the Asia Pacific region. As part of this focus, Citi recently hosted an event with the International Bankers Association of California (IBAC) to explore trends in trade with Greater China and the implications associated with the internationalization of the Renmimbi (RMB).
Prior to 2009, cross-border transfers in RMB and RMB conversion in offshore markets were prohibited, and no cross-border financing took place in the currency. Today, as the result of regulatory changes, it is feasible for companies to invoice in RMB for cross-border trade of goods and services and to settle payments in RMB for a wide range of trade activities including generic payments and receivables, letters of credit, import and export collections and letters of guarantee. Additionally, with regulatory approval, companies can make payments in RMB for dividends, investments, and other capital account transfers.
"As China pursues its longer range goals of transforming the RMB into a global currency and embraces wider use of the RMB in trade and in the global capital markets, opportunities to conduct business will expand," said William Flyge, Head of Citi’s North America Bank Services Group. "Corporate and financial institutions will have a greater need for robust execution across many businesses and they will need to understand regulatory nuances. One of the perceptions in the market is that all financial institutions can offer RMB services, but in reality there are only a handful of banks that can support cross-border RMB transactions and Citi is one of them."
"California is an important business center for trade flows between China and the U.S.," said Walt Mix, Chairman of the International Bankers Association of California and a director at Berkeley Research Group LLC in Los Angeles. “As such, banks based here must closely monitor the changing regulatory environment in China and the controlled liberalization of its currency. We are delighted that Citi, which has broad and deep experience in China, agreed to partner with us and share its insights with our members."
Citi’s Bank Services Group is the unit within Global Transaction Services that provides banking infrastructure and correspondent banking services to financial institutions, allowing them to harness evolving opportunities in important yet complex markets like China by leveraging Citi’s global and on-the-ground operations and expertise.
Citi has had a presence in China since 1902. Citi was among the first wave of banks to localize in 2007 with the establishment of Citibank (China) Co., Ltd. A major foreign exchange and clearing bank, Citi is a licensed RMB agent and has direct connections with CNAPS (China National Advanced Payment System. Citibank China is ranked no. 1 among all foreign banks in China for payment and collections based on volumes. It has the most extensive alliance arrangements with the “Big Four” local banks to allow for direct cross-bank funds transfers throughout all of China.
IBAC is the premier professional organization in California representing the global community of international financial service providers that have substantial international business. Citi is a represented on the board of IBAC through William Gilbert, Director and Western Area Head of Citi’s Bank Services Group.
Global Transaction Services, a division of Citi’s Institutional Clients Group, offers integrated cash management, trade, and securities and fund services to multinational corporations, financial institutions and public sector organizations around the world. With a network that spans more than 100 countries, Citi’s Global Transaction Services supports over 65,000 clients. As of the first quarter of 2011, it held on average $355 billion in liability balances and $13.0 trillion in assets under custody.
About International Bankers Association of California (IBAC)
IBAC, which was organized in San Francisco in 1972 as the Overseas Bankers Association in California, is a non-profit professional organization whose members include foreign banks, domestic banks, securities firms, and professionals (lawyers, accountants, consultants and commercial real estate agents), who have regular contact with the international banking community.