China Railway Group treasury centre in HK manages finances
Published: Feb 2026
Best Payments Solution
Highly Commended Winner
CR (Hong Kong) Treasury Management Co. Ltd.
Photo of Zhao Mengyuan, An Qi, Liu Qiang, Zhang Zhichao, Sun Jingjing, Song Minhao, CR (Hong Kong) Treasury Management Co. Ltd.
Song Minhao
Treasury Manager
CR (Hong Kong) Treasury Management Co., Ltd. is a subsidiary of China Railway Group Limited, a major Chinese state-owned enterprise, and serves as its financial management centre in Hong Kong.
The challenge
China Railway Group Limited (CREC) is a key participant in China’s Belt and Road Initiative, with contracts in more than 90 countries around the world and keeps exponentially expanding its overseas business coverage. CREC’s multi‑jurisdictional operations present a variety of challenges including, but not limited to, complexity brought by usage of different banks, cost burden, settlement inefficiency and suboptimal capital deployment. Due to CREC’s multinational business model, CREC inevitably needs to use different banks and spends effort adapting multiple systems.
The fragmented accounts distribution and various local currencies involved lead to a significant maintenance and reconciliation administrative burden. Meanwhile, to address the lack of connectivity among accounts in different jurisdictions, CREC must rely on SWIFT which creates huge costs and information time-lag. In addition, CREC has long suffered from difficulties to control payment timing, as most projects are in remote areas with less sophisticated banking infrastructures, and with remittance settlement efficiency subject to local banks’ operation capacities and clearing systems.
Finally, each of CREC’s projects runs at various construction phases, which exposes CREC to decentralised cash management, resulting in cash sitting idle in accounts earning no interest or incurring unnecessary fund procurement costs. The efficiency of cash deployment is largely affected by cash liquidity across jurisdictions and projects.
The solution
CREC set up CR (Hong Kong) Treasury Management Co., Ltd. (CRHK) as an offshore treasury platform in Hong Kong in 2016 and implemented a worldwide cash management solution in 2021 with three aims to:
Realise dynamic and automated monitoring.
Establish a centralised payment mechanism.
Optimise liquidity.
After four years of effort, the Hong Kong-based treasury platform CEHK, has become an information sharing centre, a payment factory and an in-house bank (IHB) for CREC’s overseas business.
Instead of relying on SWIFT, CRHK leverages its host-to-host (H2H) platform connected to Bank of China Hong Kong’s (BOCHK’s) account aggregation system to achieve account visibility, as well as data dynamisation and automation, making it possible for a single account manager to manage 700+ bank accounts for 260+ entities across 60+ jurisdictions. This new system is most effective from both a cost perspective, with HK$2m cost saved, and operation perspective to reduce data reflection time-lag from T+1 to T. To address settlement efficiency across jurisdictions, a bespoke payment solution called payment on behalf of (POBO) was introduced to CRHK aimed at centralising the payment at a group-level in Hong Kong, streamlining payment processes and ensuring payment security. In addition, shored up by BOCHK’s advanced system, CRHK can access its BOC group accounts in 35+ countries via a single bank portal for payments. In terms of daily available cash within the group, the majority is flowing into CRHK’s Hong Kong master accounts through cash pooling channels for capital appreciation and safety consideration. CREC leverages the unique interconnectivity mechanism of these cash pools to minimise financing costs, while the remaining entities enjoy the preferential financing interest costs through inter-group lending.
Best practice and innovation
The complexity of CREC is emphasised by five characteristics: a large number of groups, various banks, countless bank accounts, broad business areas and multiple currencies. The innovation of this solution is demonstrated by the collective and automated treasury management infrastructure between BOCHK and CREC. BOCHK provides CREC with a sophisticated account aggregation platform where all offshore accounts are registered and managed. A huge amount of information is automatically assembled in real-time. More importantly, this solution helps CREC save significant costs and administrative overheads. CREC benefits from the combined solution of POBO and BOCHK systems by centrally managing all businesses through the BOCHK platform, which standardises processing and provides certainty as to the whereabouts of fund movements.
Moreover, through the implementation of regional cash pools in Hong Kong and the Middle East, the groupwide cash is substantially centralised in the master accounts, giving the group a concrete picture of overall available capital. Together with the linked payment function, the payments made by each entity can be monitored and tracked by the group. CREC is now operating in a full automation system with these capacities, allowing a single person to effortlessly coordinate CREC’s extremely complex offshore banking infrastructure.
Key benefits
Cost savings.
Headcount savings.
Process efficiencies.
Increased automation.
Improved visibility.
Errors reduced.
Number of banking partners/bank accounts reduced.
Manual intervention reduced.
Increased system connectivity.
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