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WEDNESDAY, SEPTEMBER 30, 1992
CONSIDERING THE ELIGIBILITY OF AN OVERSEAS
APPLICANT, WE
"IN WOULD FROM NOW ON WISH TO BE SATISFIED THAT ITS HOME SUPERVISORY AUTHORITY HAS ESTABLISHED THE NECESSARY CAPABILITY TO MEET THE MINIMUM STANDARDS FOR THE SUPERVISION OF INTERNATIONAL BANKS AS RECOMMENDED BY THE BASLE COMMITTEE, OR IF SUCH CAPABILITY HAS NOT ALREADY BEEN ESTABLISHED, WORK IS BEING DONE TO PUT IT IN PLACE, THE SPOKESMAN
SAID.
H
HE EXPLAINED THAT EXISTING LICENSING CRITERIA HAD ALREADY RESTRICTED ELIGIBILITY TO FOREIGN BANKS WHICH WERE SUBJECT TO EFFECTIVE HOME SUPERVISION, AND WHERE THE HOME SUPERVISORS HAD NO OBJECTION TO THE APPLICATION.
то BE FULLY IN LINE WITH THE NEW STANDARDS, HOWEVER, THESE CRITERIA HAD ΤΟ BE REVISED ΤΟ REFER SPECIFICALLY TO THE HOME SUPERVISORS' CAPABILITY OF MEETING THE STANDARDS.
HE SAID WHILE FOREIGN BANKS WERE WELCOME, GOVERNMENT'S POLICY WAS THAT ONLY BANKS OF HIGH REPUTATION AND STANDING WOULD BE ADMITTED.
**WHERE BANKS HAVE CROSS-BORDER OPERATIONS, THERE MUST BE THE ASSURANCE THAT THEY ARE SUBJECT TO EFFECTIVE HOME SUPERVISION BEFORE THEY WOULD BE ALLOWED TO ENTER HONG KONG, HE ADDED.
A NUMBER OF OTHER CHANGES HAVE ALSO BEEN MADE.
"IN TERMS OF SIZE, OVERSEAS APPLICANTS WOULD BE REQUIRED TO HAVE NOT LESS THAN US$16 BILLION IN ASSETS (LESS CONTRA ITEMS), WHILE LOCAL APPLICANTS WOULD BE REQUIRED TO HAVE ASSETS (LESS CONTRA ITEMS) AND PUBLIC DEPOSITS OF HK$4 BILLION AND HK$3 BILLION RESPECTIVELY, THE SPOKESMAN SAID.
FOR
HE SAID THE CURRENT SIZE REQUIREMENTS HAD NOT BEEN CHANGED A NUMBER OF YEARS, AND IT WAS APPROPRIATE, TAKING ACCOUNT OF INFLATION, TO ADJUST THE FIGURES UPWARDS.
IN RESPECT OF THE ELIGIBILITY CRITERIA FOR LOCAL APPLICANTS, TWO CHANGES HAVE ALSO BEEN MADE TO CATER FOR THE CHANGING NEEDS OF THE BUSINESS ENVIRONMENT.
THE FIRST OF THESE BROADENS THE CRITERION THAT THE APPLICANT MUST BE PREDOMINANTLY BENEFICIALLY OWNED BY HONG KONG INTERESTS ΤΟ ENABLE CLOSE ASSOCIATION AND IDENTIFICATION WITH HONG KONG TO BE TAKEN INTO CONSIDERATION.
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**GIVEN THE DIFFICULTY IN DEFINING PREDOMINANTLY BENEFICIALLY OWNED BY HONG KONG INTERESTS' THE CHANGE WILL ENABLE A MORE FLEXIBLE INTERPRETATION OF THE CRITERION WITHOUT OPENING AN UNDESIRABLE BACKDOOK ROUTE FOR FOREIGN BANKS WHICH MAY FIND ATTRACTIVE THE SUBSTANTIALLY LOWER ASSET SIZE REQUIREMENT FOR LOCAL APPLICANTS, THE SPOKESMAN SAID.
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