Hong Kong Banking Sector's Exposure to non-bank Chinese Entities

The Hong Kong Monetary Authority today announced the results of its quarterly survey on authorised institutions' exposures to non-bank Chinese entities as at end-June 1999.

According to the survey, total exposures of the banking sector to non-bank Chinese entities at end-June 1999 amounted to HK$254.8 bn, compared with HK$280.4 bn in the previous survey at end-March 1999. This represents 3.8% of the total assets of the banking sector. At end-June 1999, on-balance sheet exposures amounted to HK$230.6 bn and off-balance sheet exposures (including guarantees, letters of credit issued on behalf of the Chinese entities by authorised institutions, and replacement costs of foreign exchange and derivatives contracts) amounted to HK$24.2 bn.

Compared with the position at end-March 1999, the total exposures of the banking sector to non-bank Chinese entities declined by HK$25.6 bn or 9.1%. The reduction was due to a combination of factors, including repayments, transfer of exposures to head office or overseas offices by some foreign institutions and reporting errors made by institutions in the previous survey. After adjusting for reporting errors, the actual reduction was HK$27.0 bn.

The local banks' total exposures to non-bank Chinese entities amounted to HK$78.3 bn, a reduction of HK$3.2 bn or 3.9% from the previous survey.

The total exposures were spread among 184 institutions, including both local and foreign institutions.

Hong Kong Monetary Authority
1 September 1999

Annex

Banking sector's exposures to non-bank Chinese entities
(as at end-June 1999)

(in HK$ bn)

* includes red-chips, H-shares, other state, provincial or municipal government owned entities and other entities known to be owned or controlled by Chinese interests.