SEOUL, Dec. 22 (Xinhua) -- South Korea on Friday picked 12 commercial banks as liquidity providers in a local market to directly exchange the domestic currency with the Chinese currency, according to the joint statement by the Bank of Korea (BOK) and Seoul's finance ministry.

The selected banks for the Won-Yuan direct transactions market will take charge with providing liquidity and setting prices to help the trading between the two currencies done smoothly in South Korea.

Six local banks picked as market makers include Kookmin Bank, Industrial Bank of Korea, Shinhan Bank, Woori Bank, KEB Hana Bank and Korea Development Bank.

Six others are local branches of foreign banks, including Deutsche Bank, Hong Kong and Shanghai Bank, Industrial and Commercial Bank of China, Bank of China, Construction Bank of China and Communications Bank of China.

The Won-Yuan direct trading market was launched in South Korea in 2014 to increase trade settlement in the two currencies and help reduce costs for exchanging the currencies.