Bank of China, one of the five biggest state-owned commercial banks in China, will expand its operations in Cambodia by opening new branches in Siem Reap and Sihanoukville, a local bank executive said yesterday.

Chen Chang Jiang, CEO of Bank of China Phnom Penh branch, said that the bank aimed to have the two branches completed by the end of this year.

“This will allow more Chinese investment to come into the country and open Cambodia up to China,” he said.

Bank of China has operated in Cambodia since 2010 and currently has two branches in the capital. The bank has been at the forefront of promoting business transactions in China’s yuan currency, offering cross-border remittance settlements services, investment and import and export payments.

Yuan cross-border settlement volumes reached $2.9 billion last year, an increase of 80 per cent year-on-year, according to Bank of China Phnom Penh branch’s 2015 annual report. Meanwhile, the bank recorded a profit of $10.2 million, an increase of 36.8 per cent compared to 2014.

Bank of China and the Industrial and Commercial Bank of China (ICBC) are the only two approved yuan clearing banks in Cambodia, while a number of local financial institutions offer settlement services as well.

Hiroshi Suzuki, CEO of the Business Research Institute for Cambodia, said that the Chinese government has been strongly pushing for the use the yuan, also known as renminbi (RMB), for international transactions, and that in Cambodia the practice was supported through Chinese banks.

However, he added that globally the yuan was slow to attract market participants due to the lack of transparency in Chinese policy about how it can be used and what restrictions are imposed by the Chinese government.

“In Cambodia, it seems that the use of RMB is still limited, partly because the Cambodian economy is highly dollarised,” he said.