PRESS RELEASE
Enclosure II
Bank of Credit and Commerce Hong Kong Limited
The Commissioner of Banking, Mr David Carse, has today (Friday) made a statement on the implications for Bank of Credit and Commerce Hong Kong Ltd (BCCHK) of the problems which have arisen elsewhere in the BCC Group. He has made it clear that the origin of these problems lies outside Hong Kong They cast no doubts on the Hong Kong banking system which remains healthy and sound.
BCCHк is ar entirely separate entity from those part of the BCC Group where the problems have arisen and should not be affected by these problems. The Commissioner has given his assurance that the operations of BCCHK remain sound and viable.
Mr Carse said: "There is no evidence here of the suspected fraud which has led to the difficulties in the rest of the BCC Group. Following the audit of its 1990 accounts, BCCHK has a substantial cushion of provisions against bad and doubtful debts and these are still regarded as adequate."
"At present, BCCHK is meeting all the
Commissioner's prudential requirements, including those relating to liquidity and capital adequacy. BCCHK has only minor dealings with the rest of the BCC Group."
The office of the Commissioner of Banking is
seeking to meet with the Government of Abu Dhabi, which is the ultimate majority owner of BCCHK, to discuss the extent and nature of any financial support for BCCHK, if any should be required. The Office of the Exchange Fund has also indicated its willingness to place funds with BCCHK, should this prove necessary, on normal commercial terms.
In the mear time, to provide further assurance that the interests of depositors are fully protected, the Comin: ssioner has appointed Mr Albert Cheok, the Deputy Commissioner of Banking, and Mr Colin Selby of The Hongkong and (hanghai Banking Corporation Ltd to act as advisers to the management of BCCHK in the prudent conduct of its business. The Commissioner has taken this action under section 52(1)(B) of the Banking Ordinance.
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