XN000022-1986-05-28 — Page 17

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WEDNESDAY, MAY 28, 1986

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TIME TO TIGHTEN BANKING SYSTEM

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IT IS TIME TO TIGHTEN AND IMPROVE THE BANKING SYSTEM SO THAT THERE IS GREATER PROTECTION FOR THE CONSUMER PUBLIC AND AN ENHANCED REPUTATION FOR HONG KONG'S BANKS AND OTHER FINANCIAL INSTITUTIONS BOTH LOCALLY AND INTERNATIONALLY, THE HON HILTON CHEONG-LEEN SAID TODAY (WEDNESDAY).

SPEAKING DURING THE RESUMED DEBATE ON THE BANKING BILL 1986, HE OBSERVED THAT LIBERALISATION IN THE BANKING INDUSTRY IN RECENT YEARS HAD CAUSED A NUMBER OF PROBLEMS TO SURFACE. IN THE INTEREST OF PRESERVING WHAT WAS GENERALLY STILL ACCEPTED AS A STABLE FINANCIAL CLIMATE, THE GOVERNMENT HAD CONSIDERED IT WISE TO COME TO THE RESCUE OF SEVERAL BANKS, AND TO USE THE EXCHANGE FUND AS THE FINANCIAL GUARANTOR OF ITS ACTIONS.

MR CHEONG-LEEN SAID IN RECENT MONTHS HE HAD HAD OCCASONS TO SPEAK TO CONCERNED PEOPLE IN THE BANKING AND INVESTMENT FIELDS IN DIFFERENT PARTS OF THE WORLD AND THERE WAS MUCH PRAISE FOR THE FINANCIAL SECRETARY AND THE BANKING COMMISSIONER FOR THEIR DECISIVE ACTIONS.

HE SAID HE SUPPORTED THE FINANCIAL SECRETARY'S DECISIONS TO ULTILISE THE EXCHANGE FUND IN THE SPECIFIC WAYS THAT HE HAD DONE TO STABILISE THE BROADER FINANCIAL SPECTRUM IN HONG KONG.

+HIS OBJECTIVE WAS MAINTAINING CONFIDENCE - BOTH INTERNALLY AND EXTERNALLY AND THAT OBJECTIVE HAS BEEN ACHIEVED,+ HE SAID.

HOWEVER, THE TIME HAD COME TO TIGHTEN AND IMPROVE THE BANKING

SYSTEM.

+AS OUR FINANCIAL SECTOR CONTINUES EXPANDING, WE SHALL HAVE TO THINK OF OUR OWN INTERESTS, NOT ONLY IN DOMESTIC TERMS, BUT EQUALLY IN GLOBAL TERMS AS WELL.

+BY SO DOING, HONG KONG'S ROLE AS A FINANCIAL SERVICES CENTRE, PROVIDING SOPHISTICATED EXPERTISE WITHIN THE ASIA-PACIFIC REGION AND PARTICULARLY TO CHINA ITSELF, WILL BE EVEN FURTHER STRENGTHENED,+ HE SAID.

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