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Banking Industry in Hong Kong
Updated on Thursday 21st December 2017 Rate this article
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A look at Hong Kong’s banking industry
The Hong Kong banking industry is one of the key components of the city’s financial system. Hong Kong is known to be Asia’s leading financial center and a large concentration of banks can be found here. More than half of the most important financial institutions have opened branches in Hong Kong.
The banking system allows for three types of financial institutions:
- licensed banks;
- restricted license banks;
- deposit-taking companies.
The Banking Ordinance stipulates the manner in which these banking institutions operate and the deposit business they may conduct. Licensed banks are the only ones that can accept deposits from the public, regardless of their size and maturity term.
Restricted license banks can only take public deposits of at least 500,000 HK$ while deposit-taking companies can accept those of at least 100,000 HK$ with a maturity term of at least three months.
Service providers in the Hong Kong banking sector
Institutions that do not qualify for a full banking license can apply for the restricted type. This system allows for the existence of a larger number of banking institutions and service providers. Investors in Hong Kong can enter the deposit-taking sector and register a company that will provide various services as well as conduct investment banking activities.
Companies operating in the banking sector will need to comply with the requirements expressed in the Banking Ordinance, have a certain amount of liquidity and capital at all times and submit returns to the Hong Kong Monetary Authority.
Our company registration agents in Hong Kong can give you complete details about the regulations in this particular business field.
The financial market in Hong Kong
The largest number of banking service providers in Hong Kong are licensed banks. The city also has a large Stock Market, one of the top three stock markets in Asia. The city’s financial regulatory system is modern and allows for a high degree of transparency and supervision: two key elements that have contributed to the quality of the market. Hong Kong is also an offshore Renminbi center.
Investors who want to provide banking services and open one of the three types of banks available in the city must also pay attention to other related fields like risk management, non-performing loans, cyber security and the rapid development of FinTech or financial technology, the applications or products developed for the financial services industry.
You can contact our company registration representatives in Hong Kong for detailed information about how to set up a bank or banking service provider or more data on the regulations in the financial sector.
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