XN000022-1991-10-31 — Page 8

THURSDAY, OCTOBER 31, 1991

OF

**SUCH ENTRY,

RANGE IF ALLOWED, COULD RESULT IN A WHOLE DETAILED REGULATORY PRESCRIPTIONS REGARDING PRODUCT AND MARKETING, WHICH DETAILED REGULATIONS COULD PROVE INSENSITIVE IN THE PARTICULAR, AND SOPORIFIC OVERALL, HE SAID.

14

MR SULLIVAN SAID IN HONG KONG THE INSURANCE INDUSTRY WAS INTENT ON DEVELOPING A SELF-REGULATORY PROGRAMME FOR THE OVERALL CONTROL OF THE QUALITY, AND THE QUALITY OF ACTIVITIES, OF ITS AGENCY THE FIELD FORCE WHICH WOULD HAVE THE RESULT OF MAKING ANY ATTEMPT BY INSURANCE AUTHORITY TO FIND ADDITIONAL EMPLOYMENT AS A REGULATOR IN THIS PARTICULAR FIELD ENTIRELY UNSUCCESSFUL.

PROCEEDINGS AGAINST BANK TO BE VIGOROUSLY CONTESTED

ISSUED CANADA

THE

GOVERNMENT HAS BEEN ADVISED THAT PROCEEDINGS HAVE BEEN BY PNC INTERNATIONAL FINANCE (ASIA) LTD AND THE ROYAL BANK OF (THE BANKS) AGAINST DAO HENG BANK ("DHB") PREVIOUSLY KNOWN AS HANG LUNG BANK ("HLB") IN HONG KONG TO RECOVER LOSSES INCURRED IN LOANS TO DOLLAR CREDIT AND FINANCING LTD ("DOLLAR CREDIT") AS A RESULT OF AN ALLEGED CONSPIRACY BETWEEN HLB AND DOLLAR CREDIT BEFORE GOVERNMENT TOOK OVER HLB IN 1983.

IN CONNECTION WITH THE

SALE OF HLB IN SEPTEMBER 1989, THE FINANCIAL SECRETARY INCORPORATED HAS GIVEN AN INDEMNITY AGAINST ANY ACTUAL LOSSES OR COSTS INCURRED BY DHB (PREVIOUSLY HLB) AS A RESULT OF THE PROCEEDINGS.

PURSUANT TO THIS INDEMNITY, THE GOVERNMENT IS ASSUMING RESPONSIBILITY FOR THE CONDUCT OF THE ACTION WITH THE CO-OPERATION AND ASSISTANCE OF DHB (PREVIOUSLY HLB). IT IS INTENDED THAT THE PROCEEDINGS WILL BE VIGOROUSLY CONTESTED,

CLAIM. SAID.

A GOVERNMENT SPOKESMAN CLARIFIED THAT THIS WAS "A SIMILAR CLAIM WAS FILED IN NEW YORK IN OCTOBER

NOT A NEW 1990," HE

"THE CLAIM WAS DISMISSED BY THE NEW YORK COURT AND THE BANKS HAVE FILED A NOTICE OF APPEAL.'

"

+

NOTE TO EDITORS:

A PRESS RELEASE ISSUED ON OCTOBER 31 LAST YEAR IN RELATION TO THE NEW YORK ACTION WHICH WAS SUBSEQUENTLY DISMISSED IS REPEATED BELOW FOR YOUR EASE OF REFERENCE:

ISSUED

"THE GOVERNMENT WAS ADVISED THAT PROCEEDINGS HAD BEEN BY PNC INTERNATIONAL FINANCE (ASIA) LTD AND THE ROYAL BANK OF CANADA AGAINST THE HANG LUNG BANK ("HLB") (NOW KNOWN AS DAO HENG BANK) IN THE USA TO RECOVER LOSSES INCURRED IN LOANS TO DOLLAR CREDIT AND FINANCING LTD ("DOLLAR CREDIT") AS A RESULT OF AN ALLEGED CONSPIRACY BETWEEN HLB AND DOLLAR CREDIT BEFORE GOVERNMENT TOOK OVER HLB IN 1983.

/"IN CONNECTION