The Bank of Korea and the Ministry of Economy and Finance announced on December 26 that they have selected 12 banks as market makers for the direct trading market between the Korean won and the Chinese yuan for next year.
An employee is showing Chinese yuan at the Counterfeit Response Center of Hana Bank headquarters in Seoul. Photo by Yonhap News Agency
The selected banks include six domestic banks-KB Kookmin Bank, NongHyup Bank, Shinhan Bank, Woori Bank, Industrial Bank of Korea, and Hana Bank-and five local branches of foreign banks: Bank of Communications, China Construction Bank, Industrial and Commercial Bank of China, Bank of China, and Hongkong and Shanghai Banking Corporation. Compared to this year, NongHyup Bank has been newly added.
The authorities explained that they considered trading performance in the won-yuan direct trading market, fulfillment of market maker quotation obligations, and the scale of customer transactions when making their selections.
These banks will continuously present bid and ask prices in the won-yuan direct trading market, playing a leading role in price formation and supplying liquidity to the market.
An official from the authorities stated, "The market maker system has greatly contributed to the successful establishment of the won-yuan direct trading market and is expected to continue playing an important role in the market's development and the increased use of the yuan. We will continue to support the stable maintenance and qualitative advancement of the won-yuan direct trading market through policy support going forward."
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