TNAG-2977-FCO40-1469-Economic-policy-in-Hong-Kong-1982 — Page 26

dollar (the main foreign

currency for deposits) over this the same time, Hong Kong dollar deposits began to

period. At the

grow again, after two quarters of decline.

3.4

There was

а further shift of deposits from deposit-taking companies to banks during the third quarter, as

registered deposit-taking companies continued to reduce their

short-term deposit base (3) In consequence, the increases

in the three months to September in total M2 (18.8%) and HK$M2

(12.8%) were considerably larger than the corresponding

increases in total M3 (12.5%) and HK$M3 (4.3%).

3.5

The outstanding value of issues of negotiable

certificates of deposit by banks and deposit-taking companies

in Hong Kong rose further during the third quarter, from

$8,909 million at the end of June to $9,856 million at the end

of September. Of this total, 50% was denominated in Hong Kong

48% of the total was held by banks and

dollars.

deposit-taking companies themselves.

Loans and advances

3.6

After rising by 9.5% during the first quarter and

7.8% during the second quarter of 1982, outstanding loans and

advances for use in Hong Kong extended by banks and

deposit-taking companies grew by 6.6% during the third quarter

/ to

(3) The Deposit-taking Companies Ordinance, as amended in 1981, requires registered deposit-taking companies to have their short term deposits (defined as those with an original term of less than 3 months) reduced by June 1982 to 50% of the June 1981 level, and to eliminate them completely by June 1983.

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