09 '86 16:41 GIS HK
P.10
it.
Risks cannot be taken.
Secondly, the Financial
Secretary will not agree that Government money should knowingly be put in the hands of those who cannot be trusted. Moreover none of us have real sympathy for the problems of managero and shareholdoro. interests are paramount.
Depositore' Thirdly, problems tend to be
cumulative. The Commissioner must get in early as he has successfully done with the Union Bank.
This is one reason
Fourthly, I
for requiring an improved Banking Ordinance. really am rather sorry about the comments made about CITIC and the irrelevancies about Tin Shui Wai and the Daya Bay nuclear plant. I welcome CITIC's investment in Ka Wah, I hope that they profit which was at their initiative. from it. They too seek to support the real interests of Hong Kong. Members will be interested to know that this rescue of Ka Wah took the Commissioner of Banking eleven months and went through at least five major variations and combinations with various possible local and overseas participants. Towards the end, management was provided by
The Standard Chartered Bank at no cost to Government. particular terms of this deal must remain confidential to those involved because of commercial and share price sensitivity, and of the stringent requirements concerning
It was certainly the secrecy in the Banking Ordinance.
best deal available and much cheaper than a takeover. outcome results in the provision of new management. secrecy provisions in the Ordinance are of major importance to the industry.
The
The
There are several similar
areas in which secrecy is enforced. for example under the Securities Ordinance. I can, however, confirm that there is an Exchange Fund guarantee to CITIC about the loau book position. It's cost cannot be quantified for at least
But as I have said, any likely contingency committment is well within the capacity of the Fund.
three years.
22.
If an efficient fire brigade extinguishes several serious fires without allowing them to damage adjacent property it should surely be congratulated.
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It