The Three-tier Banking System

Hong Kong maintains a three-tier system of deposit-taking institutions, namely, licensed banks, restricted licence banks, and deposit-taking companies. They are collectively known as authorized institutions.

Licensed Banks

Only licensed banks may operate current and savings accounts; accept deposits of any size and maturity from the public; pay or collect cheques drawn by or paid in by customers; and use the name “bank” without restriction.

List of licensed banks

Restricted Licence Banks

Restricted licence banks are principally engaged in merchant banking and capital market activities. They may take deposits of any maturity of HK$500,000 and above.

List of restricted licence banks (Excel File, 101KB)

Deposit-taking Companies

Deposit-taking companies are mostly owned by, or otherwise associated with, banks. These companies engage in a range of specialised activities, including consumer finance, commercial lending and securities business. They may take deposits of HK$100,000 or above with an original term of maturity of at least three months.

List of deposit-taking companies (Excel File, 101KB)

Local Representative Offices

Overseas banks may establish local representative offices in Hong Kong. However, these offices are not allowed to engage in any banking business and their role is confined mainly to liaison work between the bank and its customers in Hong Kong.

List of local representative offices (Excel File, 101KB)

Addresses of Authorized Institutions and Local Representative Offices

Authorization of Authorized Institutions

Under the Banking Ordinance, the HKMA is the authority responsible for the authorization of authorized institutions as well as suspension and revocation of such authorization. The HKMA has a general discretion under the Banking Ordinance to grant or refuse an application for authorization to operate a banking business or a business of taking deposits in Hong Kong.  The HKMA is, however, obliged to refuse to authorize an applicant if any of the criteria specified in the Seventh Schedule to the Banking Ordinance is not fulfilled.  The authorization criteria apply to institutions both at the time of, and after, authorization.  The HKMA assesses whether these criteria are being complied with on a continuing basis, and failure to meet any of the criteria is a ground for revocation of authorization under the Eighth Schedule to the Banking Ordinance.

All authorized institutions are subject to the same authorization criteria except that the minimum capital requirement (including paid-up share capital and balance of share premium account) for licensed banks (HK$300 million) is higher than that for restricted licence banks (HK$100 million) and deposit-taking companies (HK$25 million).  The other criteria specified in the Seventh Schedule to the Banking Ordinance cover the internationally accepted principles of a prudent licensing system, including among others, in the case of an applicant incorporated outside Hong Kong, whether the applicant is a bank adequately supervised in its home country; whether the chief executive, directors, controllers and executive officers of the applicant are “fit and proper”; the financial soundness of the applicant, in respect of capital, liquidity and asset quality; the adequacy of internal controls and accounting systems; and whether the business of the applicant is, and will continue to be, carried out with integrity, prudence and competence.

The authorization criteria for authorized institutions ensure that only fit and proper institutions are entrusted with public deposits. The HKMA has set out its interpretation of each of the minimum authorization criterion set out in the Seventh Schedule to the Banking Ordinance in Chapter 4 of the Guide to Authorization. The HKMA conducts periodic reviews of the authorization criteria and, when necessary, introduces amendments to reflect the changing needs of the regulatory environment and to meet new international standards.

To provide checks and balances, the HKMA is required under the Banking Ordinance to consult with the Financial Secretary on important authorization decisions, such as suspension and involuntary revocation. The Chief Executive-in-Council is the appellate body for hearing appeals against decisions made by the HKMA.

Hong Kong places no barrier to overseas banks operating locally in the territory, whether the transactions are conducted in Hong Kong dollars or other currencies

Under the Deposit Protection Scheme Ordinance, all licensed banks in Hong Kong are members of the Scheme unless otherwise exempted by the Hong Kong Deposit Protection Board.

Should you have any enquires on application process for an approval to become an authorized institution in Hong Kong, please email to

Last revision date : 26 August 2019