A series of Chinese banks "pour" capital into Russia, the position of the Yuan in Moscow is now different

China's four largest banks have provided billions of dollars to Russian banks, as the West pulled out of the country in the first year of the conflict in Ukraine.

Cooperating with Russian banks, China enhances the position of the Yuan. (Source: Bloomberg)

The above information was reported by the Financial Times citing data from the Kiev School of Economics (KSE) published on September 4.

Industrial and Commercial Bank of China (ICBC), Bank of China, China Construction Bank and Agricultural Bank of China increased their total capital injection into Moscow from $2.2 billion to $9.7 billion between February 2022 and March 2023.

Of which, ICBC and Bank of China account for 8.8 billion USD.

The move by the four banks is part of the world’s second-largest economy’s efforts to make the yuan an alternative to the U.S. dollar. It also reflects Russia’s efforts to use the yuan as a reserve currency.

The surge in yuan-denominated transactions comes as trade between Russia and China hits a record $185 billion by 2022.

Before the conflict in Ukraine began, more than 60% of Russia's payments for its exports were made in dollars and euros, while the yuan accounted for less than 1%.

Currently, data from the Russian Central Bank shows that USD and Euro account for less than half of the country's export payments, while CNY accounts for 16%.

In a related development, Austria's Raiffeisen Bank, the largest foreign bank with investments in Russia, increased its assets in the country by more than 40%, from $20.5 billion to $29.2 billion.

The bank revealed that it is looking to withdraw from Russia and has reduced its assets in the country by $25.5 billion since March.

Raiffeisen is one of the few Western banks that still has a significant presence in Russia after several other foreign banks closed their operations there and sold subsidiaries last year.

Source: https://baoquocte.vn/loat-ngan-hang-trung-quoc-do-von-vao-nga-vi-the-cua-nhan-dan-te-tai-moscow-gio-da-khac-240876.html