XN000022-1995-02-24 — Page 32

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Monetary Authority publishes quarterly bulletin

The latest issue of the Quarterly Bulletin published by the Hong Kong Monetary Authority (HKMA) today (Friday) contains a detailed analysis of the Hong Kong dollar interbank market.

The HKMA began to conduct a monthly survey of the Hong Kong dollar interbank market in December 1993. The present analysis is on data from the survey for September 1994. The main points of the analysis are:

* Roughly two-thirds of the gross transactions in the interbank market are placements or borrowings while foreign exchange swaps make up the remaining portion.

* Locally incorporated banks are major suppliers of Hong Kong dollar funds in the interbank market, accounting for nearly two-thirds of total net lending. Banks that are beneficially owned by China are the second biggest net lender after banks beneficially owned by Hong Kong.

* Demand for interbank Hong Kong dollar funds comes mainly from the foreign incorporated banks, especially those with a single branch licence. Funding from the interbank market is the most important source of finance for such foreign banks, with interbank borrowings with maturities of more than one day to three months making up 78 per cent of the total Hong Kong dollar liabilities of these banks.

Interbank transactions are concentrated in the region between one month and three months. Interbank lending accounts for about a quarter of the Hong Kong dollar assets of locally incorporated banks, reflecting many banks' preference to lend part of their deposit funds in the interbank market.