Hong Kong Dollar - The Most Stable and the Most Trustworthy Currency in the World

Cover Story

Hong Kong Dollar—The Most Stable and the Most Trustworthy Currency in the World

Introduced in 1983, the Linked Exchange Rate System (LERS) has helped Hong Kong to maintain a stable exchange rate, which has held steady in the face of a number of financial crises. The HKD is one of the few currencies in the world that has a constitutional basis, a key reason for Hong Kong becoming one of the world’s biggest currency trading and international financial centres. The HKD is one of the few currencies in the world that has a constitutional basis. Certainly it is popular because it is stable, but it is also trustworthy. The status of the HKD as the legal tender for Hong Kong is enshrined in Article 111 of the Basic Law, the mini-constitution for the Hong Kong Special Administrative Region (HKSAR) of the People’s Republic of China (PRC). Article 111 states that the issue of Hong Kong currency must be backed by a hundred percent reserve fund. In fact, the HKD is backed by the Exchange Fund set up in 1935, which has foreign exchange reserves of USD440 billion, more than twice the sum of the HKD monetary base. Meanwhile, article 112 of the Basic Law states that no foreign exchange control policies shall be applied in the HKSAR and HKD shall be freely convertible. This guarantees the free flow of capital into and out of Hong Kong. So why is the HKD so popular in the market? 

China World

Envisaging a Cross-border Data-driven Future
A Fresh Approach to Data Exchange in a Data-driven World

While data localisation requirements can inhibit cross-border data flows, confidential AI systems that blend cryptographical technologies from key public infrastructure with distributed computing modes, could provide a solution that helps banks to fuel post COVID-19 economic recovery and growth.

Fintech

Evolution of Business Continuity Plan

In any crisis, emergency, or pandemic, like the COVID-19 coronavirus the world is currently experiencing, it is vital that banks have a comprehensive business continuity plan in place to protect the well-being of employees, minimise disruption, and continue to provide vital services to customers. It is generally accepted that before the outbreak of Severe Acute Respiratory Syndrome (SARS) in 2003, beyond a simple back-up site, many of Hong Kong’s banks did not have a comprehensive business continuity plan in place. However, SARS changed the rules of the game as far as business continuity planning was concerned, which the current coronavirus pandemic has made even more relevant. These days, evolving from the basic back-up site, banks in Hong Kong have implemented a range of business continuity initiatives.

Knowledge Plus

Talent Development Programme Designed to Nurture a New Crop of Banking Talent

With Hong Kong’s Class of 2020 facing an uncertain job market, one bright spot on the job landscape is the launch of the innovative Banking Talent Programme designed to provide fresh university graduates with real-world of work employment experiences and professional training opportunities. Jointly launched by the Hong Kong Monetary Authority (HKMA) and the banking industry, with The Hong Kong Institute of Bankers (HKIB) as the Programme Administrator, the Banking Talent Programme (BTP) has been structured to nurture young talent for the industry, while providing participants with an opportunity to better prepare for future careers in the banking sector.

GRC Corner 

Implementing Proactive Response Strategies to COVID- People and Business Challenges

As generation-defining events go, in a matter of just a few months, the fallout from the COVID-19 pandemic has resulted in the rapid transformation of the workplace and how work is done. Working from home — at least for many bank employees — has become the new normal, while digitising the relationship between bank and customer has been extended to include the relationship between employer and employee. As the COVID-19 pandemic resets work trends with practices put in place that are likely to become permanent, banks can respond to the challenge through reshaping their workforce norms and culture to come out stronger than previously.