BEIJING--China's central bank said Sunday that it appointed Bank of China Ltd. (3988.HK), the nation's fourth-largest lender by assets, as the yuan clearing bank in Hungary.

The designated clearing bank could supply yuan liquidity in case of a shortage by directly accessing China's onshore currency market.

The announcement came after the People's Bank of China said Saturday it would expand the renminbi qualified foreign institutional investors program, or RQFII, to Hungary. The move could help increase the use of Chinese currency and boost bilateral trade and investment, the central bank said.

--Grace Zhu