The Hong Kong Monetary Authority snapped back at bears that are predicting a crisis in the city’s banking sector, calling the claims «groundless» and not based on real facts or figures.
«Hong Kong’s banking sector is among the safest worldwide,» according to an «SCMP» report citing HKMA deputy chief Arthur Yuen. «The data shows that Hong Kong’s banking sector is profitable and solid, even amid the challenging operating environment and the social unrest during the past seven months.»
Hong Kong’s banks registered a capital adequacy ratio of 20.9 percent last year, according to HKMA data, while local currency deposits rose 2.9 percent and aggregate bad loan ratios fell 4 basis points to 0.56 percent in September. In the same period, pre-tax profits of all retail banks in the city rose 1.8 percent.
No Facts or Figures
Yuen's comments follow closely on the heels of predictions by hedge fund manager Kyle Bass of a 2020 «full-fledged banking crisis» in Hong Kong. According to the founder of Dallas-based Hayman Capital, it is now betting on a stronger U.S. dollar relative to the Hong Kong dollar but isn’t making any bearish calls on local equities due to potential prevention of short-selling by officials in China and Hong Kong.
«For someone to describe the safest banking sector in the world [as facing] a crisis is just groundless, and is not based on real data and figure,» said Yuen, without naming who he was responding to.
«There are comments from time to time about the fragility of the local banking sector, usually due to misunderstanding about our banking and currency system, while some are just not based on facts and figures.»
