HKMA Appoints Standard Chartered Bank as Settlement Institution for the Euro Clearing in Hong Kong

Press Releases

03 Jul 2002

HKMA Appoints Standard Chartered Bank as Settlement Institution for the Euro Clearing in Hong Kong

At a signing ceremony held today (Wednesday), the Hong Kong Monetary Authority (HKMA) announced that Standard Chartered Bank has been appointed as the Settlement Institution for the euro clearing system in Hong Kong.

The purpose of this euro clearing system is to facilitate the efficient settlement of euro transactions on a real-time basis within the Hong Kong time zone. With the euro being one of the leading international currencies, the holding of euro and the trading of euro denominated assets may become increasingly prevalent in Hong Kong and the rest of the Asia Pacific region. An efficient and reliable euro clearing system will be an important addition to Hong Kong's financial infrastructure.

"The euro clearing system marks another milestone in the development of Hong Kong's financial infrastructure," said Mr Joseph Yam, Chief Executive of the HKMA. "By facilitating interbank payments in the euro, as well as delivery versus payment (DvP) for euro denominated securities traded in Hong Kong and payment versus payment (PvP) for foreign exchange transactions between the euro and the US dollar, the system will enhance settlement efficiency and greatly reduce settlement risk", he added.

In line with international practice and learning from the successful experience of Hong Kong's US dollar clearing system, a private sector solution has been devised for the euro clearing system. A commercial bank - Standard Chartered Bank - will act as the Settlement Institution. It will in turn appoint Hong Kong Interbank Clearing Limited, the current operator of the Hong Kong dollar and US dollar clearing systems, as its clearing agent.

Following endorsement by the Exchange Fund Advisory Committee, the HKMA has appointed Standard Chartered Bank as the Settlement Institution for a franchise period of five years from 1 March 2003.

Mr Peter Wong, Director of Standard Chartered Bank, said: "We are honoured to receive this appointment by the HKMA. As an international bank that considers Hong Kong its home base, we've been part of the fabric of the business community here for almost 150 years. Our euro-clearing status is further recognition of our commitment to Hong Kong and our desire to promote Hong Kong's position as a leading international financial hub."

The key functions of the euro clearing system will include an interbank Real Time Gross Settlement (RTGS) system, PvP settlement for EUR/USD foreign exchange transactions and DvP settlement for euro denominated debt securities through a linkage with Central Moneymarkets Unit (CMU). It is expected that the system will be ready for launch in the second quarter of 2003.

For further enquiries, please contact:

Hong Kong Monetary Authority

Mr Thomas Chan
Senior Manager (Press) at (852) 2878 1480 or

Ms Jasmin Fung
Manager (Press) at (852) 2878 8246

Standard Chartered Bank

Ms Elizabeth Armstrong
Senior Corp Affairs Manager
(852) 2821 1182 or

Ms Lavina Chan
Senior Corp Affairs Manager
(852) 2820 3075

Hong Kong Monetary Authority
Standard Chartered Bank

3 July 2002

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Last revision date : 03 July 2002