10 -
(a) first trigger
point (the point at which HK$
interest rates on the borrowings equalled the
assumed or guaranteed
rate of interest on the
investments)
When this point is reached, all
further borrowings under the Scheme would be
suspended (no new participant or further
borrowings for existing participants will be
allowed); and
Government would absorb the
additional cost;
(b)
second
trigger point : When the interest rate
on the HK$ borrowings exceeded the investment
rate by a certain percentage (say 3%) for more
than a
determined period (say 3 months), the
scheme would be
liquidated.
The investment
funds would be used to repay the loans, redeem
the bonds with any surplus, if such existed,
re-invested and paid to participating officers
as
a supplement to their entitlements on
retirement.
14.
The consultant advised that as the debt market in
Hong Kong matures, there would be sufficient liquidity in the
market for longer term instruments,
the maturities of the
securities
issued could gradually be, extended, thereby
reducing progressively the
demand for the interest rate
guarantee.
......