TNAG-1487-FCO40-2044-Hong-Kong-banking-Banking-Bill-1986-1986 — Page 219

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In an area as complex, as fragile, and as open to potential abuse

will regulation

as

supervision

and

never be

banking,

wholly

perfect nor wholly successful. I believe the Banking Bill in its present form will at least go some considerable way to addressing

the

difficulties

in

a

internationally accepted manner.

rational,

comprehensive,

and

The Banking Bill is not

landmark legislation

but

capital

essentially seeks to put teeth into the supervisory provisions of

the 1964 Act, as well

for as setting objective parameters

lending,

adequacy, and liquidity. For effective supervision it gives the Banking Commissioner access to relevant information not required to be published or supplied under other legislation. It is meant to allow the Commissioner to

to identify

the ownership, management, and

business of the financial institutions. Since banking is more of an art than a science, the Banking Commissioner's task is not an

any

easy

incipient weaknesses

one;

a

in

degree of

discretion and

he needs exercise of what must ultimately by subjective judgment.

also always balance

room for the

He must

and

for

the

the need for confidentiality preservation of trust in the system with the necessity of access full information. Fears had been expressed that the Commissioner's powers were too sweeping, and the Ad Hoc Group was pleased to see that the Administration accepted :

to

(1) the desirability to allow additional appeals from the Commissioner's decisions (in clauses 21, 22,

25, 99);

(2)

the power to issue directives under clause 82, and the functions of the Commissioner enumerated under clause 7(2) now to be subject to guidelines only;

(3) the requirements for disclosure of information on

shareholdings under clause 64 to allow the defence

of "reasonable excuse" for non-compliance;