Note Issuance Programme of the Airport Authority, the Hong Kong Mortgage Corporation Limited, Kowloon-Canton Railway Corporation and MTR Corporation Limited

On 4 June 2001, the Hong Kong Monetary Authority (HKMA), the Airport Authority (AA), the Hong Kong Mortgage Corporation Limited (HKMC), Kowloon-Canton Railway Corporation (KCRC) and MTR Corporation Limited (MTRC) announced that the HKMA would from 1 September 2001 cease to be the Arranger for the respective Note Issuance Programmes (NIPs) of the four corporations.

In response to investor enquires, Mr James H. Lau Jr, Acting Deputy Chief Executive of the HKMA, confirmed that the change to the NIP arrangement was made solely in order to ensure strict adherence to the currency board principles. "In order to minimise disruption to the market, we took the decision that the debt securities issued under the NIP prior to 1 September 2001 would remain fungible until they mature," Mr Lau said.

"In other words, market makers can continue to cover their short position in Exchange Fund paper by long position in such Specified Instruments (SIs), or vice versa. There is no intention to change the existing Discount Window arrangement on account of this latest amendment to the NIP," he added.

For further enquiries, please contact:

Jasmin Fung, Manager (Press), at 2878 8246 or
Caitlin Wong, Manager (Press), at 2878 1687

Hong Kong Monetary Authority
11 June 2001