XN000022-1995-08-09 — Page 5

- 4

Total assets of the Exchange Fund stood at HK$450 billion

The Financial Secretary announced today (Wednesday) that total assets of the Exchange Fund stood at HK$450 billion at the end of June this year, up over 10% from the end of December last year.

Sir Hamish Macleod said according to the unaudited figures, Hong Kong's foreign exchange reserves amounted to US$53.6 billion at the end of June, compared to US$49.3 billion at the end of last year. Hong Kong currently ranks seventh in the world in overall foreign exchange reserves and second in reserves per capita.

Today's announcement marks the first time data on the Fund have been available on a six-monthly basis.

In a speech to the Federation of Hong Kong Industries, Sir Hamish said he decided on publishing the results of the Exchange Fund every six months "to partly show Government's continued commitment to greater openness and transparency, and partly to provide you and others in the commercial and financial world with more evidence of the considerable strength of Hong Kong's external position."

The accumulated earnings of the Fund grew to HK$153 billion, up HK$24.2 billion or nearly 19% from the end of 1994, a result that compares favourably with returns generated elsewhere in the fund management industry.

"I think you will agree with me that these are first rate results indeed," said Sir Hamish.

The good results were attributed largely to improved investment climate in the last six months, which the Hong Kong Monetary Authority (HKMA) took full advantage of.

"The good performance was due to the fact that our major investments were in the US markets, and that market was the best performer amongst other international bond markets except Japan," said Chief Executive of HKMA, Mr Joseph Yam.