BRIEF-Aspen Group appoints Joel Cann as group CEO
* Appointment of Joel Cann as group's chief executive officer Source text for Eikon: Further company coverage:
* BoC Taipei yuan clearing rate 6.2280/6.2340 per dlr in afternoon
* Spot yuan trade in Taiwan nears that of Hong Kong
* Taiwan bank stocks rally (Adds bank comments; updates throughout)
By Faith Hung
TAIPEI, Feb 6 China's yuan traded in Taiwan for the first time on Wednesday, a further step in Beijing's march to boost the currency's global reach and promote deeper economic integration with its one-time political foe.
Taiwan, which counts China as its largest export market, is a latecomer in developing offshore yuan business as trade has been expanding in Hong Kong and London.
The much-anticipated trading of the Chinese currency in Taiwan comes as the island seeks to play a key role in the internationalisation of the yuan, also known as the renminbi (RMB), as it moves toward becoming fully convertible.
The world's second-largest economy aims to raise the profile of its currency in global trade and finance and rival foreign exchange centres are expected to jostle for market share.
Analysts said Taiwan has natural demand for the yuan and has potential to accumulate funds quickly.
"We see promising prospects for the RMB business in Taiwan, given Taiwan's trade surplus with China (a source of RMB) and Taiwan's outward FDI (foreign direct investment) to China, among other cross-strait flows," said Frances Cheung, a senior strategist of Credit Agricole CIB, in a research report.
Daily trade volume of offshore yuan, which is traded outside of mainland China, was around $2 billion but recently spiked to $3-3.5 billion this year, according to trade estimates.
The yuan was quoted at 6.2145/6.2155 to the U.S. dollar in Taiwan, in line with the rate in Hong Kong at 6.2152/6.2170. Onshore spot yuan stood at 6.2317 by mid-afternoon.
"I'm very busy now as many clients are buying renminbi in the market. The trading is quite active in the morning since it is the first day," said a trader at a Taiwan bank.
Another trader said prices in Taiwan matched those in Hong Kong. "The price so far is similar to Hong Kong's, but I'm not sure how it will perform going forward," the trader said.
The yuan clearing rate offered by Bank of China Taipei branch opened at 6.2265/6.2325 to the U.S. dollar on its first trading day in Taiwan, similar to what was offered by Bank of China Hong Kong.
BANKING STOCKS RALLY
Expectations of explosive growth for RMB-related investment products helped Taiwan's financial shares surge about 4 percent so far this week, sharply outperforming the broader market's 0.7 percent gain.
"The business is the only kind that every bank will be efforting to grab as much of as possible," said Andrew Lee, chief financial officer of EnTie Bank, which is majority owned by global private equity investor Longreach.
"However, we'll not see real contribution to profits until six - 12 months later, pending on how banks can persuade their clients to convert deposits into the yuan-denominated deposits and wealth management products," Lee said.
Taiwan is also developing its offshore yuan bond market, with BNP Paribas and Deutsche Bank among financial firms likely to issue the first yuan bond in Taiwan.
Media reports said on Tuesday that Taiwan Financial Supervisory Commission had granted approval to China Trust Commercial Bank to issue a yuan-denominated bond in Taiwan.
Taiwan's central bank said on Tuesday it would allow the island's banks to start conducting yuan currency business on the island from Wednesday.
Previously, only offshore banking units of Taiwan banks could take yuan deposits from overseas individuals and companies, suggesting a vast potential to expand the pool once local residents can do so.
Taiwan and China have been moving to bolster their ties in the financial sector, which have lagged the closer cooperation in manufacturing and other areas due to Taiwanese concerns over influence by China.
Bank of China's Taipei branch also said it was offering an interest rate of 0.648 percent for yuan deposits in current accounts. That was slightly higher than the 0.629 percent it offered in Hong Kong.
Statistics from the City of London last April showed that London's spot yuan trading represented 26 percent of the global offshore yuan spot market, following Hong Kong's 56 percent. (Additional reporting by Lin Miao-jung in TAIPEI and Michelle Chen in HONG KONG; Editing by Jacqueline Wong)
SAN FRANCISCO, Sept 28 California State Treasurer John Chiang on Wednesday announced a sweeping suspension of business relationships with Wells Fargo & Co as punishment for the company's defrauding of customers.
NEW YORK, Sept 28 Wells Fargo & Co's unprecedented move to strip Chief Executive John Stumpf of $41 million in stock awards has sent a chill through Wall Street with bankers fearful that a hardening political climate against corporate wrongdoing will encourage boards to be more aggressive about making them forfeit pay.