ENG-2020 — Page 96

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Financial and Monetary Affairs

The city has one of the world's highest concentrations of banking institutions. As at end-2020, there were 161 LBs, 17 RLBS and 12 DTCs. These 190 Als maintained a network of 1,210 local branches. There were also 43 representative offices of banks incorporated outside Hong Kong.

Total deposits and total loans and advances of Als amounted to $14,513.6 billion and $10,498.6 billion respectively, representing increases of 5.4 per cent and 1.2 per cent from a year earlier. Total assets rose 5.7 per cent to $25,865.3 billion.

Statistics on Als

2018

2019

2020

Als

186

194

190

Of which:

LBs

152

164

161

RLBS

18

17

17

DTCs

16

13

12

Local branches of Als

1,285

1,262

1,210

Total deposits ($ billion)

13,386.4

13,771.6

14,513.6

Total loans and advances ($ billion)

9,722.6

10,376.7

10,498.6

Total assets ($ billion)

24,042.7

24,462.1

25,865.3

Hong Kong maintains a robust deposit protection regime which underpins the stability of the banking system. The Deposit Protection Scheme protects eligible deposits held with banks in Hong Kong by guaranteeing compensation up to $500,000, thereby underpinning depositors' confidence in the banking system.

The various rounds of countercyclical macroprudential measures introduced by the HKMA since 2009 have strengthened the risk management of Als and the resilience of the banking sector to cope with a possible abrupt downturn in the property market. In August, after taking into account factors such as price trends and transaction volumes, economic fundamentals, and the external environment, the HKMA adjusted upward by 10 percentage points (from 40 per cent to 50 per cent for typical cases) the applicable loan-to-value ratio caps for mortgage loans on non-residential properties.

International Banking Standards

The HKMA seeks to maintain a regulatory framework fully in line with international standards. The aim is to maintain a prudential supervisory system to preserve the stability and effective working of the banking system, while providing flexibility for Als to make commercial decisions.

As a member of the Basel Committee on Banking Supervision and the Financial Stability Board (FSB), Hong Kong is committed to implementing international standards on banking regulation, including the Basel III framework and other post-crisis reform packages. The city implements

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