C.S. 20A (Rev.)
2600027
+
From the Governor, Hong Kong
SAVING TELEGRAM
TELEGRAM C102
To the Secretary of State for Foreign and Commonwealth Affairs
Repeated to:-
Repeated to:-
Date.. 27th January 1989
PASSED TO H4di
FOR DISTRIBUTION
ADVICE
MC102/5 Ree'd 2/1/87
5
No.
|
28/3
My Reference. EF121/2C (88) IV
J
No.
No.
Your Reference HKK 102/1
(1976)
Mr Man you
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Fiduciary Note Issues
NI
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Mr Footman 213 plocal. W2/3
In your LUR of 27 May 1976 you gave approval
the note-issuing banks to deposit securities issued
or guaranteed by the Hong Kong Government in respect of
their fiduciary note issues as an alternative to British
Government stock.
2.
At the present time there is a limited supply
of paper issued or guaranteed by the Hong Kong Government
and the supply will be further reduced in April 1989 when
$1 billion of Hong Kong Government Bonds issued in 1984
mature. One of the note-issuers, the Hongkong and Shanghai
Banking Corporation, has suggested the further alternative
of depositing United States Treasury Notes. Given the
establishment of the Hong Kong dollar/United States dollar
link since 1983 we see this as a sensible idea which would
obviate the need which arises in the case of gilts to
make adjustments from time to time for changes in the
exchange rate. Standard Chartered Bank have also been
consulted and have
indicated that they also would like
to have this alternative.
/ Cont'd
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