Hong Kong will protect bank deposits of up to HK$500,000 ($64,000) per depositor after full coverage introduced during the financial crisis expires tomorrow.
The new program, called the Enhanced Deposit Protection Scheme, will be effective Jan. 1, the Hong Kong Monetary Authority said in a statement on its website. Hong Kong began fully insuring bank deposits on Oct. 14, 2008, shortly after the collapse of investment bank Lehman Brothers prompted regulators around the world to boost protections to calm investors.
“The Full Deposit Guarantee has functioned effectively to shore up public confidence in Hong Kong’s banking system during the global financial crisis,” Hong Kong Financial Secretary John Tsang said in a statement. “As the global economy has become more stable, the provision of this special guarantee by the government should come to an end as originally planned.”
HKMA Chief Executive Norman Chan said Hong Kong’s banking system remains “healthy and robust,” with capitalization well above international standards.
“Public confidence in the banking system has also remained strong,” Chan said. “The expiry of the Full Deposit Guarantee is not expected to have any impact on the banking system.”
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