HSBC, AIA shares slump after report of Hong Kong bank account curbs
HSBC and AIA shares fell 4.2% and 5.1% respectively after reports that the Hong Kong Monetary Authority will tighten oversight of offshore yuan accounts. The Hang Seng Index closed 1.8% lower on the day.
Straits Times BusinessAccording to a Bloomberg report citing two unnamed sources, the Hong Kong Monetary Authority (HKMA) will broaden due-diligence requirements for offshore yuan accounts held by mainland residents; banks are expected to apply a 5 million yuan daily threshold for overseas transfer limits. HKMA deputy chief executive Eddie Yue told the Straits Times in a written statement: 'The draft rules will go to industry consultation over the next ten days.'
A HSBC spokesperson said the bank would 'comply fully with any new supervisory rules'; an AIA spokesperson declined to comment. Citi analyst Yafei Tian wrote in a note that the report 'puts at risk a scenario worth roughly 6% of annual net income from HSBC's Hong Kong operations'. Jefferies analyst Shujin Chen said the move 'may be too punitive', but policy clarity would be needed for the Hang Seng to recover.
Lu Lei, spokesperson for China's Banking and Insurance Regulatory Commission, stressed that the rules are aimed at preserving financial stability. The Hong Kong dollar's USD band showed no slippage. This is not investment advice.
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