TNAG-0381-FCO40-427-Sterling-assets-and-balance-of-payments-of-Hong-Kong-1973 — Page 178

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XCS(73)9

Statement II:

Position after 24th September 1973

(after deduction of forward sales from banks' ready positions at 24th September and compensation payments in sterling in settlement of Exchange Fund Guarantee Scheme)

(1) Government

(a)

Sterling assets

(b)

Non-Sterling assets

£mn

347

82

Total

429

(2) Banks

Residual sterling position (estimate)

60

(3) Total Official Sterling Reserves

(i. e. (1)(a) and (2))

407

(4) Total Official External Reserves

(i. e. (1) + (2))

489

Minimum Sterling Proportion

83.2%

Note:

The difference between sterling assets on 24th September 1973 (£366 million) and after (£347 million) is due to the payment of £19 million compensation in sterling to two banks under the Exchange Fund Guarantee Scheme. Other participating banks have taken their compensation payments in Hong Kong dollars, Gross payments under the Scheme have amounted to £66 million from which must be deducted £8 million, being the payment made under the Sterling Guarantee Agreement to the Exchange Fund in respect of bank-owned sterling assets, and £3 million in respect of interest and cover charges levied under the Exchange Fund Guarantee Scheme. The net cost to the Exchange Fund of the Scheme, therefore, has been £55 million.

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