XN000022-1995-04-16+17 — Page 2

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Remarks made by Secretary for the Treasury on Derivatives

The Secretary for the Treasury, Mr K C Kwong today (Sunday) told the APEC Finance Ministers Meeting that Hong Kong supported greater transparency and better international co-operation in the regulation of financial markets.

In response to the Canadian Finance Minister, Mr Paul Martin Jr.'s invitation to comment on derivatives, Mr Kwong said the recent problems with derivatives had arisen because:

a. accounting treatment of such instruments had not been clear;

b. accounting treatment was not uniform, financial institutions had different risk management control systems, and regulators have difficulty agreeing to "level-playing field" rules for capital adequacy; and

c. there are not only problems of co-operation and co-ordination in supervision between different financial systems in the domestic market but also between international markets.

"We therefore support Mr Rubin's (U.S. Secretary of the Treasury) suggestion for greater transparency and better international co-operation in the regulation of financial markets," he said.

End/Sunday, April 16, 1995

Illegal wage deduction warned

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The Labour Department today (Sunday) warned employers not to deduct wages from employees except under certain circumstances.

Optical 88 Limited in Kowloon Bay was recently fined $10,000 at Kwun Tong Magistracy for deducting wages from an employee illegally.