FINANCIAL AND MONETARY AFFAIRS
One of the missions of the HKMC is to promote the development of the MBS and debt markets in Hong Kong. The HKMC launched a back-to-back MBS Programme in October 1999. The back-to-back structure allows banks to effectively 'repackage' their mortgage portfolios into more liquid portfolios and to maintain the majority of the cash flow if they hold the MBS in their own investment portfolio. The HKMC's guarantee on the timely payment of principal and interest serves to make the MBS a safe and attractive investment for investors. The HKMC has securitised $2.26 billion of MBS with two of its key business partners. The corporation also launched a multi- currency conventional bond-style MBS Programme in December 2001 and launched the debut issue of $2 billion in March 2002.
Debt issuance is the mainstay of the HKMC's funding sources. Through debt issuing activities, the HKMC is able to achieve the objective of promoting the development of the Hong Kong dollar debt capital market. In 2002, the HKMC successfully issued 44 debt issues for a total amount of $14.8 billion under its $20 billion Debt Issuance Programme (DIP) and through the retail bond issuance scheme, making it the most active corporate issuer of fixed rate debt securities in Hong Kong. At year-end, the HKMC had 73 issues of debt securities with a total amount of over $28.6 billion outstanding. The HKMC debt securities were well received by financial institutions, as well as institutional and retail investors. To help develop the retail debt market, the HKMC pioneered a new arrangement of issuing retail bonds through banks as placing agents in October 2001. Since then the HKMC has issued 12 retail bonds for a total amount of over $6 billion. Banks and other corporations adopted the same issuing mechanism to issue retail debt securities with an aggregate issued amount of over $23 billion by year-end.
Companies Registry
The Companies Registry administers and enforces the greater part of the Companies Ordinance. The Registry incorporates local companies, registers overseas companies, registers documents required to be submitted by registered companies and provides facilities for search of company records. It also administers and enforces several other ordinances including the Trustee Ordinance, insofar as it relates to trust companies, the Registered Trustees Incorporation Ordinance and the Limited Partnerships Ordinance. The Registry is also responsible for a wide range of legal, policy and regulatory issues, including the ongoing work under the Companies Ordinance and corporate governance reviews.
Since 1993, the Companies Registry has operated as a trading fund department. Therefore, the Registry can keep most of its income and apply it flexibly, having regard to its needs, business turnover and its customers' demands and expectations. The department achieved a surplus of $37.7 million in the 2001-02 financial year despite the overall economic downturn. The substantial surplus generated over the past years has protected the department from the adverse impact of the economic downturn and helped finance the department's development projects.
The Registry has made good progress in implementing its Strategic Change Plan (SCP) to transform the department into a fully computerised Registry by late 2004 and enable electronic delivery of services in filing, processing, storing and searching documents or information. The implementation of the SCP will lead to a significant reduction in the time taken to process documents, more timely updating and disclosure of company information, improved quality of information, enhanced data security and integrity and higher productivity at reduced operating costs. The core
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