China and Singapore have agreed to extend the existing bilateral currency swap agreement (BCSA) for another three years, central banks from both sides announced on Tuesday.

The People's Bank of China (PBOC) and the Monetary Authority of Singapore (MAS) said the new agreement is effective 7 March 2016. The facility was introduced in 2010 and was renewed after three years.

According to the MAS, the BCSA is a key pillar of cooperation between PBOC and MAS to strengthen regional economic resilience and financial stability.

As per the arrangement, up to 300bn in Chinese Yuan liquidity will be available to eligible financial institutions operating in Singapore.

BCSA aims to enhance banks' confidence in carrying out their business in the two markets, and enables both central banks to provide foreign currency liquidity to stabilise financial markets, MAS said.

The renewed BCSA will also supplement the various initiatives announced at the 12th Joint Council for Bilateral Cooperation in October 2015 and the State Visit to Singapore by the President of the People's Republic of China, Mr Xi Jinping, in November 2015, MAS said.