Consultation Conclusions on Enhancements to the Deposit Protection Scheme Released

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08 May 2015

Consultation Conclusions on Enhancements to the Deposit Protection Scheme Released

The Government released today (May 8) the consultation conclusions in relation to the proposals to enhance the Deposit Protection Scheme (DPS) to achieve a faster payout for the sake of better banking stability.

The relevant proposals include –

(i)  adopting a gross payout approach to determine compensation (i.e. a depositor will be compensated an amount up to the DPS protection limit, without setting off the depositor’s liabilities against his/her deposits owed to the same bank);

(ii)  providing more certainty to determine the quantification date used for compensation calculation; and

(iii)  enabling the use of electronic communication channels by the Hong Kong Deposit Protection Board (HKDPB), in addition to the conventional paper-form communications, to notify depositors of the compensation arrangements, in case the DPS is triggered. 

“We are pleased that the responses reveal broad support for the proposals.  Although the DPS has never been triggered since its launch in 2006, we believe that the implementation of these proposed enhancement measures will help improve the efficiency and effectiveness of the DPS as an integral part of the financial safety net, and will bring the Scheme in line with the practices of major financial centres,” a Government spokesperson said.

During the three-month consultation ended in December 2014, the Government received 17 submissions from the banking industry, consumer interest group, legal and accounting professional bodies, and other relevant stakeholders.

In particular, the banking industry notes that the proposed adoption of the gross payout approach will accelerate any compensation process.  It will also streamline banks’ work on information management regarding depositors’ liabilities.  The respective proposal to enhance the clarity of determining the quantification date and to empower the HKDPB to notify affected depositors by electronic means will also improve the compensation process.

In light of the positive outcome of the consultation exercise, the Government is drafting a bill to amend the Deposit Protection Scheme Ordinance, with a view to introducing it into the Legislative Council later this year. 

The consultation conclusions are available at the websites of the Financial Services and the Treasury ( and the Hong Kong Monetary Authority (

Consultation conclusions (PDF File, 132KB)


Financial Services and the Treasury Bureau
Hong Kong Monetary Authority
8 May 2015

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Last revision date : 08 May 2015