112 KONG MONETARY AUTHORITY • ANNUAL REPORT 2001 Calendar of Events 2001

January March

The International Monetary Fund The IMF gives a positive assessment 11 (IMF) opens a sub-office in Hong 3 of ’s economic performance Kong, functioning as a subsidiary unit of and prospects and its economic and fiscal the IMF Resident Representative Office policies in its Staff Report on the Hong Kong in Beijing. Special Administrative Region (HKSAR). The IMF is impressed with the HKSAR’s rapid Twenty-one Chairmen and recovery in 1999-2000 from the Asian financial 17 Vice-Chairmen of the District crisis, attributing the successful turnaround of Councils visit Hong Kong Note Printing the economy to the flexibility of Hong Kong’s Limited (HKNPL). They are briefed on markets and to the authorities’ pragmatic the operations of HKNPL, handling of fiscal policy during the recession. printing procedures and the security features of Hong Kong .

The HKMA announces the operating 30 results of the Exchange Fund for 2000. February During the year, the Exchange Fund’s assets grew by 2.1% to $1,023.4 billion. The accumulated The HKMA holds the Fourth surplus of the Exchange Fund grew by 5.6%, 13 Distinguished Lecture, attracting from $290.9 billion at the end of 1999 to over 400 participants. Keynote Speaker $307.1 billion at the end of 2000. Mr Andrew Crockett, General Manager of the Bank for International Settlements, speaks on “Monetary Policy and Financial Stability”. Dr Zeti Akhtar Aziz, Governor of Bank Negara Malaysia, is the Discussant. HONG KONG MONETARY AUTHORITY • ANNUAL REPORT 2001 • CALENDAR OF EVENTS 2001 113

April June July

The Executive The HKMA, the Airport The final phase 24 Council 4 Authority, the Hong Kong 3 of interest rate approves in principle Mortgage Corporation Limited, deregulation covering Hong the proposal to Kowloon-Canton Railway Kong dollar savings and introduce a deposit Corporation and MTR current accounts takes effect insurance scheme in Corporation Limited announce on 3 July 2001 as scheduled. Hong Kong and that the HKMA will, from All banks are now free to requests the HKMA to 1 September 2001, cease to be set their interest rates on undertake more the arranger for the respective all types of deposits. detailed planning Note Issuance Programmes of The prohibition of interest on work for the proposed the four corporations. current accounts is also lifted scheme. at the same time. The HKMA, 19 (Hong Kong) Limited and Bank announce the launch of 20 5 JUL AUG May enhanced $1,000 banknotes with three additional security features. The HKMA holds its second The HKMA summer exhibition “Money in 21 announces Hong Kong 2001” in three that it will update the shopping centres. One of the information on its major themes of the Currency Board exhibition is on the evolution operations on a of the security features of 24-hour basis with banknotes and coins in immediate effect. Hong Kong. 114 CALENDAR OF EVENTS 2001 • HONG KONG MONETARY AUTHORITY • ANNUAL REPORT 2001

August October

The HKMA has reached an agreement with the The HKMA issues 31 Guangzhou Branch of the People’s Bank of China on 10 a letter to all extending the types of bills to be cleared under the joint authorized institutions (AIs) operations of bill clearing between stating that it would not Guangdong/Hong Kong and Shenzhen/Hong Kong to include object if AIs, should they Hong Kong dollar cashier’s orders and demand drafts as well. judge it commercially Through the facilities, clearing and settling of Hong Kong dollar desirable, were to depart bills presented in Guangdong or Shenzhen will take two from the 70% guideline in working days only. refinancing residential mortgage loans for homeowners in negative equity (i.e. whose outstanding loan exceeds the current market value of their property).

The HKMA estimates, 16 from on an ad-hoc survey of a sample of banks, that the total number of bank customers whose loans September are in negative equity may be around 65,000, or 14% of The HKMA releases a discussion paper on funding total mortgage borrowers. 7 and premium assessment for the Deposit Insurance The total value of mortgage Scheme (DIS) to seek views from the industry on the loans in negative equity may funding arrangements for the scheme. The discussion be around $127 billion, or paper contains suggestions about how the appropriate size 23% of total outstanding of the DIS fund might be set, how it could be built up mortgage loans. and maintained and how premium could be assessed for individual banks.

Following the tragic events in the US on 12 11 September, the HKMA announces that the Hong Kong dollar and US dollar RTGS systems and other clearing and payment systems in Hong Kong will be open for business as usual on 12 September.

The HKMA participates in a high-level roundtable 12 discussion to address the community’s concern over consumer debt and bankruptcy issues. HONG KONG MONETARY AUTHORITY • ANNUAL REPORT 2001 • CALENDAR OF EVENTS 2001 115

November December

The HKMA The HKMA issues a press The HKMA issues 19 announces 1 release reminding the general 11 a consultative its plans to launch public of the transitional document proposing to in 2002 the arrangements for the introduction of remove the US$16 billion Five Blessings euro coins and banknotes in 2002. asset size criterion Commemorative Coins applicable to overseas- on behalf of the The Exchange Fund incorporated banks wishing Hong Kong Special 12 Investment Limited to set up a branch in Hong Administrative Region. announces that the second and final Kong, and to relax the The set comprises five tranche of Loyalty Bonus Units in the criteria for locally silver coins together Tracker Fund of Hong Kong (TraHK) incorporated restricted with a gold medallion. have been allocated to 127,813 licence banks and deposit- The last silver coin Unitholders. taking companies to was issued in 1933. upgrade to full licensed The Hong Kong Association bank status. The HKMA 15 of Banks and the DTC 29 completes a Association jointly issue a revised The HKMA and comprehensive review Code of Banking Practice. 17 Euroclear announce of retail payment The Code is endorsed by the HKMA, their agreement to develop services in Hong Kong. who convened an informal working a direct link between The review concludes group to review the Code. the HKMA’s Central that Hong Kong’s retail Moneymarkets Unit (CMU) payment systems and the Brussels-based generally function well international central and identifies policy securities depository. issues and Scheduled to go live by the recommendations for end of 2002, this fully- their enhancement of automated real-time link sectoral efficiency and will enable investors in transparency. Hong Kong and other parts of Asia to directly hold and settle Euroclear-eligible debt securities via their CMU accounts. The HKMA removes the 30 three-building condition attached to the licences of overseas-incorporated banks authorized in and after 1978 and overseas-incorporated restricted licence banks authorized in and after 1990. There is now no restriction on the number of branches that these institutions may maintain.