ENG-2005 — Page 128

98 Financial and Monetary Affairs

secondary market properties, demonstrating that the MIP is particularly instrumental in promoting the liquidity of the secondary market.

Mortgage-backed Securities Market

Apart from contributing to banking stability and promoting home ownership, the HKMC also aims to promote the development of mortgage-backed securities (MBS) and the bond market in Hong Kong. The HKMC established a back-to-back MBS programme in October 1999 which provides a platform for banks to effectively repackage their mortgage portfolios into more liquid MBS. The HKMC guarantees the timely payment of interest and repayment of principal for the securitised mortgage loans. Since the inception of the back-to-back MBS programme, $2.8 billion of MBS have been issued.

In December 2001, to further develop the range of products available in Hong Kong's MBS market, the HKMC established the Bauhinia MBS Programme with MBS issuance collateralised with mortgage loans from the HKMC's retained mortgage portfolio. This is a multi-currency programme with conventional bond-style features to make it more attractive to investors. A total of $8.4 billion of MBS had been issued under the Bauhinia MBS Programme by the end of the year, including the first-ever retail MBS in Asia in 2004.

Debt issuance

Unsecured corporate debts are the mainstay of the HKMC's funding requirements. Through its debt-issuing activities, the HKMC is able to promote the development of the Hong Kong dollar debt market. In 2005, the HKMC successfully launched 28 debt issues for a total of $4.5 billion under its Debt Issuance Programme, making it the most active corporate issuer of debt securities in Hong Kong for the fifth consecutive year. By the end of 2005, the HKMC had $28.2 billion of debt securities outstanding.

In October 2001, the HKMC pioneered the issue of retail bonds using banks as placing agents. By the end of 2005 the HKMC has issued retail bonds totalling over $11 billion. In view of the solid development of the retail bond market, the HKMC replaced its standalone issues by setting up the Retail Bond Issuance Programme in May 2004. Under the programme, the HKMC has issued an aggregate of $2.3 billion in retail bonds, including US-dollar-denominated retail bonds.

Companies Registry

The Companies Registry administers and enforces the major part of the CO. The Registry incorporates local companies, registers overseas companies, deregisters defunct solvent private companies, registers documents required to be submitted by registered companies and provides the public with services and facilities to inspect and obtain information held by the registry on various statutory registers, as well as the current data of companies incorporated and registered with the registry. It also administers and enforces several other ordinances including the Trustee Ordinance (insofar as it relates to trust companies), the Registered Trustees Incorporation Ordinance and the Limited Partnerships Ordinance. The registry is also responsible for