TNAG-0448-FCO40-513-Sterling-assets-and-balance-of-payments-of-Hong-Kong-1974 — Page 102

C

CONFIDENTIAL

official sterling reserves, total official external reserves will, for the purpose of calculating balances eligible for guarantee, be treated as equal to official sterling reserves.

(3) For the purpose of calculating balances eligible for guarantee on each of the relevant days the total amount of all sterling which, on each such day, the holders of those balances are then under contract to sell forward will be deducted from balances otherwise eligible for guarantee.

Implementation

5.

(1) Any amount due under the guarantee will be calculated in accordance with the following formula:

A x B)

A = D

C

where

A = eligible balances

B = 100 minus the guarantee rate

C 100 minus the implementation rate

D - amount due.

(2)

Payment of any amount due will be effected in sterling to the account stipulated for the purposes of the Sterling Agreement as soon as the amount has been agreed between the Bank of England and the Government of Hong Kong.

Advices

6. (1) In order to be able to benefit from the guarantee, advices, submitted in accordance with the implementation arrangements agreed for the purposes of the Sterling Agreement as modified by the following provisions of this paragraph, will have to be given to the Bank of England.

(2) Such advices will be needed as on the last working day

CONFIDENTIAL

4