Need for derivative guidelines
By SEAN KENNEDY
THE Barings disaster has made the need for improved guidelines on derivatives trading more urgent, Sir Hamish said.
He said the Government was examining the case to see what lessons could be learned for Hong Kong.
'No one is quite sure what went wrong in Barings' case,' he said. 'It would be irresponsible to say, 'Everything is alright, we are okay and we don't intend to do anything'.' He said: 'Derivatives have a role. But they can also be abused. We will try to have a risk-management system and inspection to keep the risk to the minimum.' In his speech, which was written before Barings' collapse, Sir Hamish said improving guidelines for financial derivatives so risks could be better managed was high on the Government's agenda.
'A major priority for the year ahead will be to draw up further guidelines for financial derivatives,' he said.