Circular Letter ST.15-0126 — Adaptation of Reporting Instructions

2, boulevard Royal L-2983 Luxembourg Télécopie (+352) 4774-4943 E-mail: reporting.banques@bcl.lu ./.
Ref.: ST.15-0126 Luxembourg, April 16, 2015
To all credit institutions
To all reporting software providers
To transmission channels
Subject: Adaptation of Reporting Instructions

Madam, Sir,

We wish to provide you with an update to the reporting instructions, which should resolve various inconsistencies in the instructions regarding reports S 1.5, S 1.9, and S 2.5.

We also wish to inform you that we have received requests for clarification regarding report S 1.9 "Information on CNY transactions," particularly in relation to the distinction between CNY and CNH currency codes. Indeed, some banks have raised the question of whether only CNY positions should be reported or whether CNH positions should also be included.

In this context, we wish to provide the following clarifications.

• The Chinese Currency

  • The Chinese currency is officially called the renminbi (RMB). The yuan is the unit of account. The renminbi is therefore the name of the currency traded onshore and offshore. However, there is a separation between onshore and offshore markets because China exercises capital controls that prevent the currency from leaving the country and vice versa.
  • If the RMB is quoted in China, it is called CNY, whereas if the RMB is quoted outside China (in fact mainly in Hong Kong), it trades at the USD/CNH exchange rate for RMB deliverable in Hong Kong. Thus, while the RMB is a single currency, it trades at two different exchange rates depending on where it is traded.

• Statistical Reporting

  • Report S 1.9 was indeed designed to report CNY positions to identify Renminbi transactions following the appointment of various clearing banks in certain European countries.
  • The currency breakdowns to be provided as part of statistical reporting are based on ISO currency codes; however, according to the ISO 4217 list of currency codes, there is no CNH currency code. The BCL has nevertheless accepted the provision of the CNH currency code insofar as the exchange rate of the latter differs (generally slightly) from the exchange rate of the CNY. However, in the context of counting Renminbi activity, this poses a problem because a limitation to CNY would not allow for the correct measurement of Renminbi usage.

Thus, although we are willing to continue accepting both currency codes for reports S 2.5-L and S 2.5-N, we have modified the validation rules for report S 1.9 to group all Renminbi operations under the CNY code, whether denominated in CNY or CNH.

Please accept, Madams, Sirs, the assurance of our perfect consideration.

BANQUE CENTRALE DU LUXEMBOURG
Romain Weber Roland Nockels
Head of the Section for Banking and Monetary Statistics Head of the Statistics Department

2, boulevard Royal L-2983 Luxembourg Télécopie (+352) 4774-4943 E-mail: reporting.banques@bcl.lu ./.
Annexes: 3

• Collection of validation rules for report S 1.5
• Collection of validation rules for report S 1.9
• Collection of validation rules for report S 2.5