Central Bank of China

PRESS RELEASE Release Date: April 8, 2004




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Overview of offshore banking units (February 2004)

At the end of February, 2004, there were 70 offshore banking units(OBUs)in operation. Of these, 41 belonged to domestic banks and 29 belonged to foreign banks. The combined assets of all OBUs amounted to US$67.635 billion at the end of February, 2004; increased by US$16.040 billion or 31.09%compared with the same month of the previous year. Domestic bank OBUs accounted for US$45.475 billion or 67%of these combined assets, and foreign bank OBUs accounted for US$22.160 billion or 33%of the total.

Based on balance sheet analysis, the OBUs' main sources of funds were due to related offices and deposits by financial institutions, which together accounted for 68%of total liabilities. Of these, due to related offices accounted for 43%of total liabilities, deposits by financial institutions situated locally for 17%, those by financial institutions located overseas for 4%, and inter-OBU deposits for 4%. The other sources of funds included deposits by non-financial institutions, accounting for 24%of total liabilities, and other liabilities plus the equity of head office for 8%. In terms of the area of origin, Asia accounted for 72%, followed by America with 17%, Europe with 8%, and other areas with 3%.

The main uses of funds were due from related offices and deposits with financial institutions which together accounted for 56%of total assets. A further breakdown shows 40%was due from related offices, 9%was deposited overseas, 4%with domestic OBUs and 3%with other domestic financial institutions. The other uses of funds included loans, accounting for 24%of total assets, security investments for 12%, and other assets for 8%. Asia was the main destination for funds, accounting for 70%, followed by America with 18%, Europe with 10%, and other areas with 2%.

The total value of all outstanding loans made by OBUs at the end of February, 2004, amounted to US$16.370 billion, of which 81%was extended to oversea debtors, and 19%to local debtors. Of this amount, long-term loans extended to oversea debtors accounted for US$7.601 billion, followed by short-term loans extended to oversea debtors with US$5.681 billion, and loans extended to local debtors with US$3.088 billion.

The volume of export related banking business of all OBUs in February was US$6.721 billion. Of this amount, export collection plus export remittance accounted for US$5.394 billion, and export negotiation for US$1.327 billion. The volume of import related banking business of all OBUs was US$4.929 billion.

The turnover of foreign exchange trading by all OBUs in February was US$8.368 billion. Of this amount, spot transactions accounted for US$5.412 billion, followed by outright forwards with US$1.742 billion, and foreign exchange swaps with US$1.214 billion.

The turnover of trading other derivative products by all OBUs in February was US$4.810 billion. Of this amount, options accounted for US$3.648 billion, followed by foreign currency interest rate swaps with US$0.644 billion, financial futures with US$0.429 billion, foreign currency forward rate agreements with US$0.040 billion, margin account tradings with US$0.035 billion and credit derivatives with US$0.014 billion.