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Reality check

Published on Tuesday, 23 Sep 2014
Dr Patrick Fung, HKIB and Wing Hang Bank chairman, sees closer links between HK and China banks.
Photo: Berton Chang

As it does every year, the Hong Kong Institute of Bankers (HKIB) Annual Banking Conference will provide an opportunity for leading industry figures to discuss the exciting opportunities and major challenges facing them.

Dr Patrick Fung, chairman of the HKIB and chairman of Wing Hang Bank, says there are two elements that make this conference so consistently important and successful. "First, we take into account what has happened in the past 12 months and make sure the conference covers the very current issues," he says. "Second, every year we have a regulator participating, and I believe whenever the regulator is involved, the industry pays attention. And indeed, [the regulator uses] the conference as a way to communicate certain points to us."

Regulatory keynote speakers in previous years have highlighted issues such as Basel III and the development of the Bank for International Settlements. This year's speaker will be Arthur Yuen, deputy chief executive of the Hong Kong Monetary Authority.

The conference's opening keynote speaker will be Financial Secretary John Tsang Chun-wah.

The conference will take place at the Hong Kong Convention and Exhibition Centre on September 23, with an overall theme of "The Paradigm Shift", a look at the forces driving change in banking.

Fung breaks these forces down into several categories. Among these are the ongoing challenges related to Basel III and the compliance issues that ensued after the global financial crisis. He also sees the end of quantitative easing in the US as a development that could lead to a rise in interest rates in Hong Kong next year.

However, he sees the main focus of the local banking scene continuing to shift towards its greater connection with the mainland.

"The speed of this shift has a lot to do with China's policies and how China is moving along with its offshore renminbi development, its convertibility development, and its capital flow development," Fung says.

Important related recent events include the way in which the use of offshore renminbi is being encouraged in the Shanghai Free Trade Zone, and also the upcoming Shanghai-Hong Kong Stock Connect, Fung says.

"It's a small first step for the eventual free flow of the renminbi in and out of China. The reason I say this is a small step is because there still is a quota - there is only so much that can be done within a day or month. Also, it is limited to certain stocks and not any other direct investment."

Fung sees a widening of the renminbi exchange rate band as key to a healthy capital flow in and out of the mainland. He believes local bankers should not be concerned about the increasing internationalisation of the renminbi, with the number of offshore renminbi centres expanding beyond London, Singapore and Taiwan. "I think Hong Kong will always be the dominant offshore renminbi centre," he says. "We still have about 70 per cent of the overall offshore renminbi [deposits] in the world."

Other developments on the conference agenda include the move by e-commerce platforms such as Alibaba into the retail investment market and the expanding use of digital technology.


HKIB Annual Banking Conference 2014 Highlights


  • Theme

The Paradigm Shift


  • Date and time

September 23, 8:55am-5pm


  • Venue

HKCEC, Wan Chai


  • Keynote speeches

- John Tsang, Fianancial Secretary, HKSAR

- The Chinese Banking Sector: Strategies for Growth Model Change

- Evolving Role of the Bank CEO in the New Regime

- Promoting Sound Risk Culture


  • Panel discussion 

The Paradigm Shift - Shaping the Future


  • Afternoon streams

Banking Business; The Transformers; Compliance, Operations and Risk Management


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