People's Republic of China-Hong Kong Special Administrative Region: Selected Issues

January 12, 2017

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People's Republic of China-Hong Kong Special Administrative Region: Selected Issues, (USA: International Monetary Fund, 2017) accessed December 3, 2024

Summary

This Selected Issues paper analyzes Hong Kong Special Administrative Region (SAR) banks’ exposure to nonbanking businesses in Mainland China. Hong Kong SAR banks are generally less exposed to riskier Mainland businesses. Despite that, a sharp deterioration in the balance sheet of Mainland businesses, as well as a sharper-than-expected downturn in the Mainland economy could negatively affect Hong Kong SAR banks, raising debt at risk well above suggested estimates. As Hong Kong SAR banks generally have sizable buffers against downside risks, the best approach to such a scenario is vigilance, including maintaining high origination and underwriting standards.

Subject: Balance of payments, Banking, Current account, Current account surpluses, Financial institutions, International trade, Labor, Loans, Trade balance, Wages

Keywords: Asia and Pacific, China, CR, Current account, Current account surpluses, Global, Growth distribution, Hong Kong Sar bank, ISCR, Labor earnings growth, Lending, Loans, Nonbank Mainland China exposure, SAR, Trade balance, Vis-à-vis Mainland China, Wage, Wages

Publication Details

Pages:

25
Volume:

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DOI:

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Issue:

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Series:

Country Report No. 2017/012
Stock No:

1HKGEA2017002
ISBN:

9781475566062
ISSN:

1934-7685

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