505
j
IT'
Bank of Credit and CommERCE
KONG KONG LIMITED
2
3.
4.
5.
The
annual
accounts
of
of BCCHK and its subsidiary BCCI Finance for 31st December, 1990, a copy which is attached hereto audited by Messrs. Price Waterhouse, show that there was a trading loss of at year end 1990. However, HK$431,285,000.00 amounts due from group companies to BCCHK had been reduced in that year from HK8939,771,000.00 to HK$211,707,000.00. The consolidated balance sheet reflects a similar reduction of exposure to the BCCI Group (page 3, 5 and note 3 on page 7 of the and accounts). BOCHK has thus made considerable successful efforts to reduce its exposure to other members of the Group and as of June 30th, 1991, the net cash exposure to group companies is HK$37,080,743.45 reflecting further efforts by the management to insulate the local operations Group uncertainties.
from
into loan to
Subsequent to the year end, the shareholders of BCCHK introduced funds of HK$124.80 million BCCHK in the form of a subordinated restore BCCHK's capital to the level required under the bank's capital adequacy requirement as set by the office of the Banking Commissioner.
The
ratio
present year for BCCHK appeared to be going well. The operation in Hong Kong was, to use the phrase of the Commissioner of Banking, "sound and viable" and the provisions made in the previous year, including the reduction of BCCHK's exposure to the Group meant that it had insulated itself from the BCCI Group worldwide that may have become troubled. Prudent provisions for specific bad loans were also made in close consultation with external auditors and Banking Commissioner's Office. Also, on advice of external auditors and to further strengthen our balance sheet robust general provisions were set aside last year as additional safeguard against contingencies arising out of ur certainties in relation to the Group and general market conditions.
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