Hong Kong (Bank Supervision) (Hansard, 18 November 1981)

§ 14. Dr. Bray
asked the Lord Privy Seal whether he is satisfied with the arrangements for bank supervision in Hong Kong.

§ Mr. Humphrey Atkins
Bank supervision in Hong Kong is primarily a matter for the Hong Kong Government. In the view of Her Majesty's Government the arrangements are satisfactory.

§ Dr. Bray
While holding no more brief for the takeover of the Royal Bank of Scotland by the Standard and Chartered Bank rather than by the Hong Kong and Shanghai Bank, may I ask the right hon. Gentleman whether he is aware that if the Hong Kong and Shanghai Bank were to take over the Royal Bank, being such a major British bank, this would raise questions about the arrangements for bank supervision in Hong Kong in view of the anomalous position of the absence of any central bank?

§ Mr. Atkins
As the hon. Gentleman knows very well, this bid is now the subject of study by the Monopolies and Mergers Commission and I do not think that it would be right for me to hazard a guess as to the outcome. However, as I have said, I know that there is not a central bank in Hong Kong, but the arrangements for conducting the banking affairs of Hong Kong, which are under the direction of the Governor and the Commissioner for Banks, seem to the British Government to be quite satisfactory. When the Hong Kong and Shanghai Bank took over an American Bank, it was inquired into very closely and the same conclusion was arrived at.

§ Mr. Eggar
In view of the close relationship between Hong Kong and the United Kingdom, is there not a very good case for the Hong Kong and Shanghai Bank to be regarded, to all intents and purposes, as a British bank? If that is so, is it not also right that the Hong Kong and Shanghai Bank should be subjected to the same disclosure requirements as British clearing banks?

§ Mr. Atkins
It is a misapprehension held by some people, regrettably, that the Hong Kong and Shanghai Bank is a foreign bank. It is not a foreign bank. It is a bank that is incorporated in a British dependent territory and is subject to the rules of that territory and to the supervision of the Government.