機密
two Italian banks have Hong Kong 6 or 7 would probably satisfy the size criterion for a Hong Kong licence, but
but officials are not aware that any of these is at present contemplating applying.
8
In forwarding BCI's application, in accordance with section 6 (3) of the Ordinance,
of the Ordinance, the Commissioner of Banking has stated that he considers the applicant to meet the licensing criteria, and has recommended that a licence be granted.
Citicorp Banking Corporation (CBC)
9
CBC is a wholly owned subsidiary of Citicorp. It is incorporated in Delaware. It does not operate as a bank in the United States but has, with approval from the Federal Reserve Board, opened branches in the Bahamas, Bahrain and Jersey, where it conducts wholesale offshore business. A condition of its presence in these places, imposed by the Federal Reserve, is that it does not, in effect, transact business with US non-bank customers. The principal function of these branches is therefore to gather wholesale funds for on-lending to its parent, Citicorp. CBC now wishes to open a Hong Kong branch with a similar role, and has Federal Reserve permission to apply.
10
Two factors are of particular
considering this application
>
importance in
•
(a) the Federal Reserve Board has stated that CBC is "not considered as a bank for purposes of US law and supervision" and that CBC is "not regulated as a bank by the Federal Reserve System nor by any domestic authority regulating depository institutions" While it is true that the Federal Reserve's supervisory system includes surveillance and overview of CBC's operations as a non-bank subsidiary of Citicorp, this form of supervision is quite different from that exercised by the Federal Reserve over banks;
(b)
while the total assets (net of contra items) of CBC consolidated with its subsidiaries stood at US$12.6 billion at end-1982 and estimated US$18.3 billion at end-June 1983, the figure for CBC alone (excluding subsidiaries) was,
at the latter date, only US$4.2 billion, well below the announced threshold of US$12 billion. Although there are sound reasons
in accountancy for examining CBC on a consolidated basis, the a Hong Kong banking licence
criterion
for
CONFIDENTIAL