XN000022-1984-01-06 — Page 3

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FRIDAY, JANUARY 6, 1984

DEPOSITS

HONG KONG DOLLAR DEPOSITS ROSE SHARPLY DURING THE MONTH, BY 6.2 PER CENT, FOLLOWING AN INCREASE IN OCTOBER OF 3.9 PER CENT. THESE INCREASES WERE NO DOUBT ENCOURAGED BY STABILITY IN THE EXCHANGE VALUE OF THE HONG KONG DOLLAR AND THE REMOVAL OF THE INTEREST WITHHOLDING TAX ON HONG KONG DOLLAR DEPOSITS.

THE INCREASE IN NOVEMBER, AMOUNTING TO $8.6 BILLION, IS THE LARGEST MONTHLY INCREASE ON RECORD. PART OF THIS INCREASE REFLECTED A SWITCH FROM FOREIGN CURRENCY DEPOSITS WHICH FELL BY 1.2 PER CENT OR $1.7 BILLION.

IN THE THREE MONTHS TO NOVEMBER. HONG KONG DOLLAR DEPOSITS GREW BY 9.3 PER CENT, WHILE THERE WAS NO NET CHANGE IN FOREIGN CURRENCY DEPOSITS.

LOANS AND ADVANCES

TOTAL LOANS AND ADVANCES EXTENDED BY BANKS AND DEPOSIT- TAKING COMPANIES ROSE BY 0.9 PER CENT IN NOVEMBER, OFFSETTING THE DECREASE OF THE SAME ORDER IN OCTOBER. IN THE THREE MONTHS TO NOVEMBER, THESE GREW BY 5.4 PER CENT. LOANS TO FINANCE VISIBLE TRADE OF HONG KONG FELL BY 0.9 PER CENT, AFTER FALL ING BY 0.4 PER CENT IN OCTOBER.

IN THE THREE MONTHS TO NOVEMBER, THEY GREW BY 2.8 PER CENT. ALTHOUGH HONG KONG'S TRADE HAS BEEN EXPANDING RAPIDLY, THE ASSOCIATED BUOYANCY OF NET EXPORT EARNINGS MAY EXPLAIN THE ONLY MODEST DEMAND IN THIS CATEGORY OF LENDING. OTHER LOANS FOR USE IN HONG KONG GREW BY 0.9 PER CENT COMPARED WITH A FALL OF 0.3 PER CENT IN OCTOBER. IN THE THREE MONTHS TO NOVEMBER, THE GROWTH RATE WAS 3.9 PER CENT.

FOREIGN CURRENCY POSITION

THE NET SPOT FOREIGN CURRENCY LIABILITIES OF THE MONETARY SECTOR FELL FROM $23.2 BILLION AT THE END OF OCTOBER TO $17.8 BILLION AT THE END OF NOVEMBER. BANKS AND DEPOSIT-TAKING COMPANIES HAD NET SPOT FOREIGN CURRENCY LIABILITIES OF $13.0 BILLION AND $4.8 BILLION RESPECTIVELY AT THE END OF NOVEMBER.

STATISTICS COLLECTED (ON THE BASIS OF SLIGHTLY DIFFERENT DEFINITIONS) BY THE COMMISSIONER OF BANKING AND DEPOSIT-TAKING COMPANIES SHOW A SIMILAR REDUCTION FROM $26.2 BILLION AT THE END OF OCTOBER TO $18.7 BILLION AT THE END OF NOVEMBER.

THEY ALSO SHOW A REDUCTION OF SIMILAR MAGNITUDE IN THE MONETARY SECTOR'S NET FORWARD FOREIGN CURRENCY ASSETS FROM $49.1 BILLION TO $42.9 BILLION. THIS SUGGESTS THAT THE REDUCTION IN FOREIGN CURRENCY DEPOSITS, REFERRED TO EARLIER, MAY HAVE LARGELY COMPRISED SWAP DEPOSITS.

/LIQUIDITY RATIOS