Bank of China (BOC) signed a memorandum of cooperation with Sumitomo Mitsui Banking Corporation (SMBC) on Thursday on yuan-related business due to increasing trade between China and Japan.

According to the memo, the two banks will cooperate in cross-border yuan trade settlement and fund-raising in yuan and other yuan-related business and research, BOC said in a statement on its website.

The move will not only deepen cooperation between the two banks but also promote the further development of bilateral trade between the two countries, the statement said.

BOC currently has five branches in Japan.

SMBC, a subsidiary of Sumitomo Mitsui Financial Group, is one of the top three banks in Japan.