A draft of the Code of Banking Practice is issued today (17 January) to be followed by a period of consultation.
"The introduction of such a Code will help promote good banking practices and a fair and transparent relationship between authorized institutions and their customers. In the end, customer loyalty and confidence will be enhanced thus contributing to the stability of the banking system," said Mr. Raymond Li, Executive Director (Banking Policy) of the Hong Kong Monetary Authority (HKMA). "The purpose of the Code is to set minimum standards with which banks should comply. It should be noted that the standards being proposed are in line with that of other financial centres."
The draft Code was developed by a working group formed in early 1996 by the HKMA and representatives of the banking industry. The section dealing with the use of referees and the chapter on debt collection were issued last year in advance of the full Code.
"The consultation exercise is important. We would like to produce a Code that can strike a reasonable balance between consumer rights and efficiency of banking operations," said Mr. Li, "I would stress that the draft Code, being what it is, is subject to further changes taking into account comments received during the consultation period."
The draft Code comprises five chapters. It covers, among other things, the relationship between banks and customers, opening and operation of accounts and loans, card services, payment services and debt collection. The Code is non-statutory and will be issued by the industry on a voluntary basis. Institutions will however be expected to observe the Code and the HKMA will monitor compliance.
The draft Code will be made available to all authorized institutions in Hong Kong through the Hong Kong Association of Banks and the Deposit-taking Companies Association, Legislative Council Panel on Financial Affairs, the Consumer Council, the Privacy Commissioner for Personal Data, the Chairperson of the Equal Opportunities Commission and other relevant bodies for comment. Interested parties can request in writing a copy of the draft or retrieve it from the HKMA internet website: http://www.info.gov.hk/hkma. The consultation period will end on 28 February 1997. The final Code is expected to be issued in the first half of 1997.
Hong Kong Monetary Authority
17 January 1997