DBS plans to expand HK loan book by 10% this year

[HONG KONG] DBS Group Holdings, South-east Asia's largest bank, plans to expand its Hong Kong loan book by about 10 per cent this year, mainly targeting small and medium-sized companies and trade with mainland China.

DBS's 2012 yuan trade settlement surged 60 per cent from a year earlier, said Sebastian Paredes, the Singapore-based bank's chief executive officer for Hong Kong. He predicts that business using the renminbi will grow beyond the 17 per cent of total revenue that it reached last year.

Lenders in Hong Kong handled about 90 per cent of China's yuan-denominated trade payments last year, while sales of so- called dim sum bonds climbed to 174 billion yuan (S$35 billion), a 15 per cent jump from a year earlier, data compiled by Bloomberg show. Premier Wen Jiabao last week pledged to expand global use of the currency as the nation seeks to cut reliance on the dollar.

"What we clearly want is to continue the RMB products, the RMB services and the RMB capabilities to be in the forefront of the banking sector," Mr Paredes said in an interview on March 8. "You would expect a continuation of rapid growth in the utilisation of the RMB not only in trade, but in FX, in money markets, in debt."