Joint Clearing Facility for HK Dollar Cheques issued by banks in Guangdong and presented in Hong Kong

The Hong Kong Monetary Authority (HKMA) announced today (Monday) that it has reached an agreement with the Guangzhou Branch of the People's Bank of China (PBoC) on a new Joint Clearing Facility to speed up the processing of Hong Kong Dollar cheques issued by banks in Guangdong and presented in Hong Kong.

The Joint Clearing Facility will be implemented by Hong Kong Interbank Clearing Limited (HKICL), the Guangzhou Electronic Banking Settlement Centre and the Shenzhen Financial Electronics Settlement Centre (SFESC) by the end of June 2002. Under the new facility, the time required for clearing Hong Kong Dollar cheques issued by banks in Guangdong and presented in Hong Kong will be reduced to two working days. The Joint Clearing Facility will streamline the collection and delivery of the cheques to the clearing houses in Guangzhou and Shenzhen for processing.

Currently very few Hong Kong Dollar cheques issued by banks in Guangdong are presented in Hong Kong. This new facility is a significant step towards facilitating financial flows and co-operation between Hong Kong and Guangdong.

Joint cheque clearing in the other direction (i.e. Hong Kong dollar cheques issued by banks in Hong Kong and presented in Guangdong) has already been in place since 1998 and has been functioning very well, covering all the major cities in Guangdong. In 2001, 120,000 cheques were processed, with a total value of HK$12 billion.

"I welcome the introduction of this new Joint Clearing Facility, which is part of the HKMA's on-going efforts to develop our market infrastructure. The streamlining of the processing will help to improve settlement efficiency and reduce settlement risks. The facility is another example of co-operation between the PBoC and the HKMA on issues of mutual benefit," said Mr Tony Latter, Deputy Chief Executive of the HKMA.

For further enquiries, please contact:

Thomas Chan, Senior Manager (Press), at 2878 1480 or
Jasmin Fung, Manager (Press), at 2878 8246

Hong Kong Monetary Authority
18 March 2002