DBS Bank, the Singapore headquartered bank, has introduced a range of Renminbi denominated services for its Taiwan business.

The launch covers a series of RMB-tailored products covering fixed deposits, mutual funds and transaction fee discounts. Among them is a special RMB-denominated fixed deposit program that offers six-month fixed deposits of RMB at a 2.8 per cent interest rate. Deposit amounts are limited to between $60,000 and $200,000.

In addition, new wealth management clients who join until 30 December 2013 will get a 70 per cent discount on transaction fees for their first three mutual fund trades done domestically or internationally within the first three months. Clients with existing accounts in Hong Kong and China and have a portfolio of at least NT$2 million will also see their ATM cards upgraded to Visa Plus, which allows withdrawals throughout the Greater China region sans the fees.

The launch comes after the Financial Supervisory Commission's announcement in June that RMB-denominated deposits through the offshore banking unit scheme went down month-on-month for the first time since the practice was approved in 2011, dropping 4.7 per cent to $117.8 billion. 

OBUs are offshore units of banks that have received the go signal to operate banking and other financial services in a foreign country. The recent drop in RMB OBU deposits in Taiwan may be due to the surge of withdrawals by China-based Taiwan businesses during the credit crunch in late June. Regardless, DBS Bank Taiwan says the RMB remains a highly relevant factor in investment strategies and is set to grow further in the next years. 

According to the FSC, OBU deposits have increased from August 2011 from $116 million to as high as $118 billion in May 2013.