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Authorised investments permitted for trustees list revised
The Government today (Friday) published in the Gazette an amendment order to revise the list of authorised investments permitted for trustees as contained in the Second Schedule to the Trustee Ordinance.
The revised list of authorised trustee investments is the work of a Working Party set up under the Financial Services Branch in June 1993. The Working Party is chaired by the deputy Secretary for Financial Services and comprises representatives from the Securities and Futures Commission, the Hong Kong Monetary Authority, the Office of the Commissioner for Insurance, the Companies Registry, and the Attorney General's Chambers.
"The revised Second Schedule replaces the original list and comprises six categories, namely corporate securities, non-corporate debt securities, collective investment schemes, cash and short term investments, property, and derivatives for hedging purposes," said a Government spokesman.
"Corporate securities are restricted to shares of 'blue chips' or debentures that meet the specified credit ratings," he said.
"Blue chips' are companies with a market capitalisation of HK$10 billion or equivalent in a foreign currency and are listed in HK or a recognised stock market," he explained.
"The specified credit ratings are Moody's A3 or S&P's A- for long-term instruments or Moody's Prime-1 or S&P's A-1 for short-term instruments," the spokesman added.
Non-corporate debt securities include those issued or guaranteed by government or central bank in Hong Kong and overseas, or multilateral agencies. In Hong Kong, the Exchange Fund and 100% government-owned corporations are included. In overseas, the country must meet the specified sovereign rating, and multilateral agencies must meet the specified supranational rating. The specified sovereign/supranational rating are the same as the specified credit rating for corporate debt securities.
Collective investment schemes include all unit trusts and mutual funds authorised by the Securities and Futures Commission.