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WEDNESDAY, MARCH 11, 1992
GOVT REGULARLY REVIEWS BANKING LAW
IT IS THE GOVERNMENT'S POLICY TO REVIEW AND REVISE LEGISLATION RELATING TO BANKS REGULARLY TO ENSURE EFFECTIVE SUPERVISION OF AUTHORISED INSTITUTIONS AND TO PROTECT THE INTERESTS
OF DEPOSITORS.
THIS WAS STATED BY THE FINANCIAL SECRETARY, THE HON HAMISH MACLEOD, WHEN REPLYING TO A QUESTION BY DR THE HON CONRAD K.S. LAM IN THE LEGISLATIVE COUNCIL TODAY (WEDNESDAY).
THE SECRETARY SAID THE EXTENT TO WHICH MORE INFORMATION SHOULD BE MADE PUBLICLY AVAILABLE IN RESPECT OF BANKING OPERATIONS WAS ONE OF MANY ISSUES THAT WOULD BE CONSIDERED AS PART OF THAT ON-GOING REVIEW.
SHALL ALSO BE CONSCIOUS OF THE NEED TO MAINTAIN THE STABILITY OF THE BANKING SYSTEM, HE ADDED.
"BUT WE
AS TO THE UNRECORDED LIABILTIES OF A BANK, MR MACLEOD POINTED OUT THAT SHOULD A BANK HAVE SUCH, THAT WAS TO SAY THAT THERE WERE CLAIMS WHICH WERE NOT RECORDED IN ITS BOOKS THOUGH IN ACCORDANCE WITH STANDARD ACCOUNTING PRACTICES THEY OUGHT TO HAVE BEEN, IT MIGHT NOT BE POSSIBLE TO DISCOVER THESE, HOWEVER TRANSPARENT THE OPERATIONS OF THE BANK WERE TO BECOME.
HE SAID THEY COULD WELL ONLY BE IDENTIFIED WHEN THE PERSONS PURPORTING TO HAVE SUCH CLAIMS ON THE BANK CAME FORWARD AND MADE THEIR CLAIMS.
CERTAINLY IT WOULD SEEM THAT THE CLAIMS WHICH HAVE RECENTLY BEEN LODGED WITH THE PROVISIONAL LIQUIDATOR OF BCCHK (THE BANK OF OF THE CREDIT AND COMMERCE HONG KONG) BY LIQUIDATORS OF OTHER PARTS
'RECORDED' OR BCC GROUP WORLDWIDE, WHETHER THEY CAN BE DESCRIBED AS 'UNRECORDED' LIABILITIES, ARE NOT SUCH AS COULD HAVE BEEN REASONABLY IDENTIFIED OR ANTICIPATED BY A REGULATOR OF AUDITOR.
"THESE
HAVE YET CLAIMS, ARISING OUT OF THE BUSINESS OF BCCHK TO BE EVALUATED, AND IF NECESSARY, RULED UPON BY THE COURT," HE ADDED.
THE SECRETARY SAID IT WOULD NOT BE A PRACTICABLE PROPOSITION TO CONDUCT A COMPREHENSIVE INVESTIGATION INTO POSSIBLE UNRECORDED OR FOTENTIAL LIABILITIES IN OTHER AUTHORISED INSTITUTIONS BEARING IN MIND THE LARGE NUMBER OF AUTHORISED INSTITUTIONS AND THE SCALE AND OF THEIR BUSINESS.
EXTENT
THE BEST PREVENTIVE MEASURE WAS ΤΟ ENSURE THAT ONLY
WITH INSTITUTIONS
IN PRUDENT MANAGEMENT WERE AUTHORISED TO OPERATE
HONG
AND KONG
THAT INSTITUTIONS HAD
INTERNAL GOOD AND EFFECTIVE CONTROL SYSTEMS WHICH COULD GUARD AGAINST FRAUD AND MALPRACTICES INCLUDING FAILURE TO KEEP PROPER RECORDS OF TRANSACTIONS, HE SAID.
AND THE ENTRY
"IN
THIS CONNECTION, THE CONTROLS ON BANK OWNERSHIP AUTHORISATION POLICY HAVE BEEN SUBSTANTIALLY IMPROVED SINCE THE OF BCCHK IN 1979.
/"A PERSON