Bank of America Merill Lynch was recently tapped by Michigan-based TRW—one of the largest automotive suppliers in the world—in a cross-border cash management pilot program in China’s Shanghai Free Trade Zone (FTZ).
BofA Merrill Lynch and TRW signed several agreements with foreign officials from the People’s Bank of China, Shanghai FTZ and State Administration of Foreign Exchange at a ceremony in Shanghai on Monday.
Through its participation in the program, the bank may help Chinese companies in need of U.S. dollar payments and collections systems to address working capital requirements. Companies that participate in the program must be profitable, demonstrate sound internal procedures and accounting and must be foreign exchange violation-free for at least three years.
“The Shanghai FTZ has rapidly evolved in scope and sophistication and will continue to influence the treasury management decisions at leading corporations with a China presence,” Cathy Dou, the head of global transaction services for China at BofA Merrill, said. “By participating in the [U.S. dollar] cross-border sweeping program, our solution flexibility, client consultancy and demonstrated track record of execution position us at a competitive advantage to service the treasury needs of TRW and other entities operating in the… FTZ.”