Exchange Fund Position at the end of June 2009
The Hong Kong Monetary Authority (HKMA) today (Thursday) published the position of the Exchange Fund at the end of June 2009.
The Exchange Fund recorded an investment gain of HK$25.0 billion in the first half of 2009. The main components were (Annex 1)
- a valuation gain on, and dividends from, Hong Kong equities portfolio amounting to HK$26.1 billion
- a valuation gain on, and dividends from, other equities amounting to HK$9.2 billion
- an exchange valuation gain of HK$2.0 billion
- a valuation loss, net of interest, on bonds and other investments of HK$12.3 billion.
After deducting interest and other expenses, the net investment income for the first half of 2009 was HK$23.3 billion. Taking into account fee payments to the Fiscal Reserves and placements by Hong Kong government bodies of HK$17.9 billion, and adding back the valuation gain and dividend income on the Strategic Portfolio of HK$3.1 billion, the Accumulated Surplus recorded an increase of HK$8.5 billion (Annex 1).
The Abridged Balance Sheet (Annex 2) shows that the total assets of the Exchange Fund stood at HK$1,833.2 billion at the end of June 2009, an increase of HK$272.9 billion compared with the end of 2008.
Commenting on the Exchange Fund results for the first half of 2009, Mr Joseph Yam, Chief Executive of the HKMA, said that the investment environment had remained challenging since the last quarter of 2008. Bond and equities markets had declined markedly in the first two months of 2009 on concerns about continuing global economic difficulties. Since March, stimulus packages in the major economies had led to a rebound in equities markets. But the reprieve in the bond market had been short-lived as concerns over the supply of US government bonds and the timing and pace of the exit from monetary easing had driven yields on long-term US treasuries higher. "It is encouraging that, despite difficult market-conditions, the Exchange Fund recorded an investment gain of HK$25.0 billion in the first half of the year," Mr Yam said.
Looking ahead, Mr Yam commented that recovery in the developed economies would take time. Although the stimulus packages had restored liquidity to the global financial system, credit availability remained limited. "The HKMA, with the guidance of the Exchange Fund Advisory Committee and its Investment Sub-Committee, will continue to be vigilant in this difficult environment and to manage the Exchange Fund prudently," he said
For further enquiries, please contact:
Peggy Lo, Manager (Communications), at 2878 1687 or
Hing-fung Wong, Manager (Communications), at 2878 1802
Hong Kong Monetary Authority
30 July 2009