Hongkong Post meets to discuss its role in banking

PUBLISHED : Thursday, 04 May, 2006, 12:00am
UPDATED : Thursday, 04 May, 2006, 12:00am


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Hongkong Post and banking industry representatives have held preliminary talks aimed at allowing post offices to perform limited banking services, but serious legal issues must first be resolved, it was disclosed yesterday.

Talks were held two weeks ago between the Hong Kong Association of Banks and Hongkong Post, in which bankers said they hoped post offices could take up some banking transactions, the postal service disclosed yesterday.

Banks have been accused of trying to get rid of small depositors by imposing hefty charges and shutting branches.

However, under the Post Office Ordinance, post offices can only offer postal-related services.

'We'd consider any proposal that helps us boost our business growth and expansion,' Postmaster-General Allan Chiang Yam-wang said.

'But we've difficulty with the law - it needs to be amended before we can provide banking services ... among the many other factors that need to be considered,' Mr Chiang said.

The banks' association was not available for comment yesterday.

Mr Chiang also said his department had started to explore the feasibility of renewing machinery and refurbishing buildings, such as the 30-year-old General Post Office in Central.

'We're far behind other countries in areas such as infrastructure and facilities,' Mr Chiang said. He also did not rule out the possibility of finding a new site for the Central GPO.

The plan to rebuild the GPO in Central was scrapped when the self-financing Hongkong Post recorded losses for five consecutive years to 2003-04. The post office ended its years in the red the following financial year, by posting a $17 million profit. Its profit rocketed 1,223 per cent to $225 million in the last financial year.

'We don't have a concrete plan yet but it's the right time for us to [push ahead with upgrades].'

But since a huge sum would be required to upgrade the hardware, he said the department could not simply lower service charges whenever it recorded a profit.