sector has a leading role, no matter appraised by asset value or contribution to gdp. on the rmb front, all through the years, our country has been deepening financial reform through internationalizing the rmb. in the 12th five year plan, the strategic preparation of “ enlarge the cross - border use of the rmb with a view to gradually realizing the free convertibility of capital items denominated in rmb ” has been clearly stipulated. recently, the pboc and related government agencies have been implementing new ways incessantly to widen the channel of rmb recycling, enlarge cross - border use of rmb, explore rmb fdi ( foreign direct investment by overseas investors ). at the moment, the pilot area for cross - border trade settlement in rmb has been extended to cover the whole country while the scope has been extended from initially merchandize trade to services trade and other current items, and will be extended to cover some capital items. all these moves have bis central bankers ’ speeches propelled further development of cross - border rmb business and provided driving force in promoting the use of rmb internationally. the whole exercise has provided opportunity for further development of rmb business, motivation in the internationalization of the rmb, while macao will benefit from financial and rmb business development. as a special administrative region of the nation, macao is obliged and delighted to participate in the process of the internationalization of rmb. as a matter of fact, macao was designated as early as 2004 as one of the pilot areas for cross - border rmb business. in july 2009, the pboc and relevant ministries of the state council jointly promulgated “ management of cross - border rmb trade settlement under pilot programme ”, which permitted macau banks to conduct cross - border rmb trade settlement business. at the same time, the scope of individual rmb business was widened in december 2009 from the scope in the beginning. in tandem with the increasing integration of macao with the mainland, rmb notes are broadly accepted and circulated in macao. rmb business has become an important driving force behind business diversification of macao financial institutions and the healthy progress of the sector as a whole. as per the end of april 2012, the value of rmb deposit with banks in macao stood at rmb49. 8 billion ( 12 % of total deposits ), which was an increase of 85. 8 % year - on

has been adopting free market economic system. according to the “ basic laws of the macao special administrative region ”, macao has no fx control policy, the msar guarantees free operation of financial markets and financial institutions and the free flow of funds into and out of the msar without restrictions. in the realm of the implementation of free market economic system, according to the heritage foundation ’ s “ global index of economic freedom ” published in january 2012, macao ranks 6th in asia - pacific while among the 179 economic systems round the globe, macao ranks 19th. in a free market economic system, funds can move without obstacles, can facilitate and provide foundation for development of cross - border rmb business. second, macao has a safe and stable banking system all along. it has developed crossborder services with other nations and regions. at the moment, there are 29 banks permitted to operate in macao. they mainly come from the mainland, portugal, hong kong, the uk, the us, singapore and chinese taipei. the biggest players are from the mainland. as per the end of april this year, aggregate assets of macao banking system stood at mop732. 8 billion, a year - on - year increase of 21. 3 % ; total loans stood at mop355. 9 billion, a year - on - year increase of 21. 8 % ; total deposits were valued at mop476. 9 billion, a year - on - year increase of 26. 2 %. non - performing loan ratio was only 0. 32 % ; capital adequacy ratio reached 15. 1 %, composed mainly of tier one capital. at the same time, liquidity in the banking system is relatively ample, as per the end of april, one month liquidity ratio of the banking system was 69. 7 %, three month ratio was 70. 4 %. there is one thing worth special mentioning ; up to this moment, direct impact of the recent international financial crisis on the macao banking system is rather limited. in business operation, apart from servicing local demand, macao bis central bankers ’ speeches banks make use of macao as their business development platform. through their global networks, they proactively develop services with other nations and regions, among which, a substantial part is cross - border financial business between the mainland and other nations or regions. third, macao has been an important liaison platform in the economic and commercial cooperation between china and portuguese speaking