Hong Kong Monetary Authority Proposes Key Enhancements to Banking Ordinance
Alvin Lang Dec 05, 2024 10:13
The Hong Kong Monetary Authority has opened a public consultation on proposed amendments to the Banking Ordinance, aiming to strengthen regulatory frameworks and enhance banking stability.
The Hong Kong Monetary Authority (HKMA) has initiated a public consultation on proposed enhancements to the Banking Ordinance, according to the HKMA. This initiative aims to address the evolving landscape of banking regulations and ensure that Hong Kong's financial system remains robust and resilient.
Purpose of the Review
In light of rapid developments and international regulatory trends, HKMA's review focuses on updating the legal framework governing banking regulation in Hong Kong. The proposed enhancements aim to better align the local system with international standards and address issues identified from past supervisory experiences.
Key Focus Areas
The consultation emphasizes six priority areas where amendments are deemed necessary. These include simplifying the three-tier banking system into a two-tier structure and enhancing information sharing among authorized institutions to combat financial crime. Additionally, the HKMA is examining the Monetary Authority's enforcement powers, with industry consultations already underway.
Proposed Amendments
The newly issued consultation paper outlines further proposals, such as establishing a statutory framework for the regulation of designated holding companies of locally incorporated authorized institutions (AIs). It also suggests granting the Monetary Authority flexibility to engage skilled professionals to aid in regulatory duties under the Banking Ordinance, along with various technical amendments.
Related Ordinance Amendments
Amendments are also proposed for two other ordinances relevant to the banking sector: the Financial Institutions (Resolution) Ordinance and the Hong Kong Association of Banks Ordinance. These changes aim to enhance the overall regulatory environment and ensure comprehensive oversight.
Consultation Process
The public consultation commenced on December 5, 2024, and will remain open until January 28, 2025. Stakeholders are encouraged to review the consultation paper, available on the HKMA website, and submit their feedback via email or post.
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