Hong Kong regulators urge banks to expand offshore yuan use and prepare for AI in finance

Hong Kong’s top financial regulators have urged local banks to make greater use of the city’s growing pool of offshore yuan liquidity, while also flagging the need to prepare for a coming wave of autonomous AI systems used in the financial sector.

Speaking at the Hong Kong Association of Banks (HKAB) Distinguished Speaker Luncheon, Eddie Yue Wai-man, chief executive of the Hong Kong Monetary Authority (HKMA), called on lenders to leverage their international networks to expand the Chinese currency’s global reach.

“We want your bank to use your global network to help us channel all this renminbi liquidity to the world,” Yue said.

“There will not be any cap to it,” Yue said, adding that the facility’s quota could be expanded as demand increased and existing capacity was well used. He also urged lenders to report operational problems and difficulties faced by clients so the system could be refined.

However, Hong Kong’s Securities and Futures Commission (SFC) chief executive Julia Leung Fung-yee cautioned that wider international use of the yuan could stall unless financial institutions developed a deeper suite of yield-bearing and risk-hedging products.