Yuan deposit growth hits new high in July

By Lee Minji

SEOUL, Aug. 8 (Yonhap) -- Chinese yuan-denominated deposits at banks in South Korea increased at the fastest clip last month, touching a fresh high, as investors flocked to park their money in yuan accounts, central bank data showed Friday.

The yuan-denominated deposits held by residents reached US$16.2 billion in July, growing by a record $4.2 billion from the previous month, according to the Bank of Korea.

Yuan deposits have been trending higher since late last year, with monthly gains logging a previous record of $2.5 billion in November 2013.

Buoyed by the record on-month increase, the portion of yuan deposits among all foreign currency deposits soared to a record 25.9 percent, compared with 20.3 percent in June.

"Chinese yuan deposits expanded at a record pace as local institutions beefed up their yuan deposits at Chinese lenders based in South Korea," a central bank official said.

Overall foreign currency deposits came in at $62.5 billion in July, breaking the $60 billion mark for the first time.

With the exception of yuan deposits, foreign currency deposits in the U.S. dollar, euro, and Japanese yen shrank from the previous month.

Dollar-denominated deposits, which accounted for 64.5 percent of all foreign currency deposits, declined by $400 million to $40.3 billion.

Deposits in the euro and the yen came in at $2.3 billion and $2.5 billion, respectively, according to the data.

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