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Banking (A) Bill 1995: committee stage (existing clauses)

Following is the speech by the Secretary for Financial Services, Mr Michael Cartland, at the committee stage (existing clauses) of the Banking (Amendment) Bill 1995 in the Legislative Council today (Thursday):

Mr Chairman,

I move that the clauses specified be amended as set out in the paper circulated to Members. I should briefly highlight to Members the more important amendments.

Clause 3

Section 3 is amended by new clause 3(a) to remove any potential doubt arising from the taking of margin deposits by licensed leveraged foreign exchange traders. This is consistent with existing exemptions granted to margin deposits taken by licensed securities and commodities dealers.

Clause 5

On the powers of temporary suspension, section 24(1)(b) is amended by new clause 5(f) so that the powers become exercisable only when the Monetary Authority considers it necessary in the interests of depositors or potential depositors of the institution. Alternatively, there would be a public interest test before such powers can be invoked: in such case the Monetary Authority must be advised by the Financial Secretary that it is in the public interest for urgent action to be taken. This would be consistent with section 52(1)(d) of the Ordinance (concerning the Monetary Authority's powers of control) and would reflect the fact that the Financial Secretary would be in a better position than the Monetary Authority to judge the public interest.

Clause 14

On the suggestion of the Hong Kong Association of Banks, section 53C(10) is amended by new clause 14(e) to afford protection to any third party who deals with the Manager of an institution in good faith and for good consideration.

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