The Hong Kong Monetary Authority (HKMA) today releases the
second issue of the Year 2000 Bulletin as part of its ongoing
efforts to promote awareness and disseminate information on Year
2000 issues to the banking industry in Hong Kong.
This issue of the Bulletin includes an article on the Year 2000
compliance progress of authorized institutions (AIs). According to
the formal statements of the chief executives of AIs with respect
to their Year 2000 compliance progress as at end-May 1998 position,
it was found that:
- Around 97% and 91% of the institutions were expected to achieve
Year 2000 compliance by 31 December 1998 for their critical and
non-critical systems respectively;
- The overall percentage of completion of the Year 2000 work for
critical and non-critical systems used by the Hong Kong operations
were 60% and 55% respectively;
- AIs had spent 45% and 33% of their budgets on critical and
non-critical systems respectively; and
- Around 94% of the chief executives were satisfied with the
overall progress made and that sufficient resources had been
devoted to the project.
"It appears that the banking sector is making reasonable
progress towards achieving Year 2000 compliance by end-December
1998. However, there are also some institutions which did not
expect to meet the compliance deadline in certain respects or
considerably lagged behind industry averages in terms of their
progress. The HKMA will follow up with these institutions to ensure
that they will take all reasonable steps to achieve Year 2000
compliance as soon as possible," said Mr. David Carse, Deputy Chief
Executive of the HKMA, when commenting on the results.
The Bulletin also highlights other recent supervisory
initiatives to address the Year 2000 problem. Apart from the
request for formal statements, the HKMA has required that all AIs
be subject to some form of independent assessment of the Year 2000
compliance process. The HKMA has also been in discussion with
overseas supervisory authorities to strengthen Year 2000
supervisory co-operation in line with the recent recommendations by
the Basle Committee on Banking Supervision for supervisory
co-operation on Year 2000 cross-border issues.
The Bulletin also contains articles contributed by market
practitioners on the external testing of major financial systems in
Hong Kong, legal issues, credit risk issues, embedded systems and
testing for Year 2000 compliance. These articles should help
facilitate the sharing of sound practices in resolving Year 2000
issues.
Hong Kong Monetary Authority
31 August 1998
