Former New York City Mayor Michael R. Bloomberg will chair a newly formed working group to establish trading and clearing of the Chinese currency RMB in the United States, says an announcement.
Mary Schapiro will serve as vice-chair, and Thomas J. Donohue, Timothy Geithner and Henry Paulson will co-chair the Working Group on U.S. RMB Trading and Clearing.
China has signed official currency swap agreements with dozens of countries and jurisdictions including the U.K., Canada, South Korea, Argentina, Brazil, Indonesia, Malaysia, Singapore, and Thailand.
The formation of the working group follows a bilateral summit at the White House between President Obama and President Xi in September, when the two leaders agreed to further strengthen the financial cooperation between the two nations, including discussing mechanisms "to facilitate RMB trading and clearing in the United States."
The working group aims to chart a framework that will make it easier for U.S institutions to make or receive RMB payments, thereby lowering their transactional costs and increasing their efficiency.
"President Obama and President Xi came to an important agreement that will greatly benefit both the United States and China, and it’s now incumbent on U.S. industry to follow their lead," says Bloomberg.
"In particular, advancing a mechanism to trade the Chinese currency in the United States will improve the competitiveness of U.S. companies, while furthering America’s financial sector and economy."
The working group plans to involve a diverse group industry participants, study different operating models, consider different types of RMB products and services that could be most useful for U.S. markets, educating the U.S. marketplace on the benefits and mechanics of RMB trading, among others.
The group initially also includes the following member institutions: The U.S. Chamber of Commerce; Bank of America; BNY Mellon; Citi; Goldman Sachs; JP Morgan Chase; Morgan Stanley; Wells Fargo; Agricultural Bank of China; Bank of China; Bank of Communications; China Construction Bank; and Industrial and Commercial Bank of China.
Additional firms are expected to join the group in the near future, says the statement.