CYPHER/CAT A
IMMEDIATE HONG KONG
TELEGRAM NO.2219
SECRET
SECRET
R+PA K$16
6
TO FOREIGN AND COMMONWEALTH OFFICE
2 DECEMBER 1968
ADDRESSED FCO TELEGRAM NO, 2219 OF 2ND DECEMBER.
7、
YOUR TELEGRAM 1615 : EXCHANGE FUND AMENDMENT BILL.
INTENTION IS THAT EXCHANGE FUND BORROW HONG KONG DOLLARS FROM
BANKS, PURCHASE THEIR ELIGIBLE STERLING ASSETS THEREWITH AND RE-
DEPOSIT IN STERLING WITH BANKS. THERE WOULD BE STRICT PROVISIONS
TO ENSURE THAT BANKS WERE AT ALL TIMES FİRM HOLDERS OF UNDERLYING
STERLING ASSETS OF TYPE ELIGIBLE FOR GUARANTEE IN AMOUNT OF AT
LEAST EXCHANGE FUND STERLING DEPOSITS WITH THEM. IN ANY EVENT, WE
ASSUME THAT IN THE EVENT OF YOUR EVER HAVING TO IMPLEMENT STERLING
GUARANTEE, WE WILL BE REQUIRED, AS A MATTER OF COURSE, TO SATISFY
YOU OF THIS. WE, THEREFORE, OURSELVES HAVE REASON TO TAKE THIS
PRECAUTION.
2. 1 MIGHT ADD THAT STERLING COUNTERPART OF HONG KONG DOLLAR
BALANCES OF BRANCH AND CORRESPONDENT BANKS WITH HONG KONG BANKS. WILL
BE ELIGIBLE FOR THIS FACILITY ONLY WITHIN APPROVED LIMITS.
3. BILL IS DOWN FOR COMPLETION OF SECOND READING, COMMITTEE STAGE
AND THIRD READING ON 4TH DECEMBER. GRATEFUL FOR VERY EARLY REPLY.
SIR D.
TRENCH
FILE S
F.P.A.D.
H.K.D.
LART
MR.
COMBS
RES.
کی
MR.
MORETON
LEGAL ADVISER
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