Russia’s biggest bank launches financing in Chinese yuan

Sberbank, Russia’s largest lender, will be the first bank in the country to start issuing credit guarantees denominated in Chinese yuan. The new yuan-based letters of credit ensure payments between buyers and sellers, with the bank acting as a router.

This will make payments for import contracts settled in yuan more seamless, the bank said in astatement Tuesday.

“An important aspect of these transactions is that post-import financing was attracted in Chinese yuan, which is especially relevant given the existing market environment,” the statement says. “Starting transitions in RMB will allow customers to not only meet current funding requirements and settlements, but also to continue active cooperation with Chinese suppliers.”

Letters of credit are considered secure and convenient in international trade, as they are designed to protect both buyers and suppliers, and offer a good alternative to advance payment .... http://rt.com/business