Leveraging Offshore RMB Transaction

Intercompany loan to subsidiary in Mainland China

Usage

The use of offshore RMB makes RMB-denominated intercompany loan (to subsidiary in Mainland China) possible.

Differences by currency

Advantages of offshore RMB transaction

  • ・Forex risk in the subsidiary can be shifted to the Head Office by adopting RMB-denominated loan.

Notes

  • ・In case of a RMB-denominated intercompany loan, the head office bears the RMB Forex risk.
  • ・For a cross-border loan, a subsidiary must acquire the "funding limit" following the regulations of Mainland China.
Regulations on cross-border loans

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