SHANGHAI-- The annual transaction volume of Shanghai's financial markets is expected to reach 1,000 trillion yuan ($160 trillion) by 2015, Shanghai's top financial services official said Thursday.

Transactions of Shanghai's financial markets, including the Shanghai Stock Exchange, inter-bank bond market, Shanghai Futures Exchange, Shanghai Gold Exchange, reached 188 trillion yuan in the first half of the year, up 7 percent compared with the same period last year, said Fang Xinghai, head of Shanghai's financial services office.

Fang said Shanghai would further improve its financial system to encourage more bond issuance, establish an insurance exchange platform, start a board for listing of overseas companies, allow the listing of foreign exchange-traded funds (ETF), and expand channels for internationalizing the Chinese currency yuan.

Fang said many state and foreign financial institutions have set up offices in Shanghai. At the end of 2010, about half of the foreign financial institutions in China, such as Citigroup, HSBC, Morgan Stanley and Bank of America, were based in Shanghai.

A latest released global financial center ranking lists Shanghai as the sixth most competitive financial center in the world, up from the eighth last year.

The city comes after New York, London, Tokyo, Hong Kong and Singapore this year, according to the Xinhua-Dow Jones International Financial Centers Development Index (IFCD Index) issued this July. The index is based on a comprehensive valuation of 45 international financial centers.