Lai See

PUBLISHED : Tuesday, 23 November, 2010, 12:00am
UPDATED : Tuesday, 23 November, 2010, 12:00am

Appointments to Hospital Authority raise questions

It is interesting to see that with last week's appointments to the Hospital Authority, all four of the directors of the Bauhinia Foundation are now members of the authority. They include Anthony Wu Ting-yuk, who is chairman of both the authority and the foundation, Donald Li Kwok-Tung and Winnie Ng Wing-mui.

The foundation was set up in 2006, the year after Tsang Yam-kuen became the chief executive. According to its website, its objective is 'to promote the understanding of the One Country, Two Systems arrangements in Hong Kong and other socioeconomic policies in Hong Kong for public benefit through the support of relevant policy research work and studies'.

The foundation is funded by tycoons such as Stanley Ho Hung-sun, Lee Shau-kee, and Cheng Yu-tung. According to David Webb's, these gentlemen were also significant donors to Tsang's election campaigns.

Why does the Hospital Authority require the expertise of the entire directorate of the foundation? Why would the foundation want to focus so much of its directors' attention on the authority? Could it possibly be related to the government's controversial Voluntary Health Protection Scheme, which is currently undergoing a public consultation process? Possibly, Tsang feels it would be useful to muster his firepower on this.

The foundation is not unfamiliar with the issue, having done its own research on the subject in a paper entitled 'Development and Financing of Hong Kong's Future Health Care'.

Wiser heads than ours have suggested that the tycoons decide what they want, then get the foundation to say it, and then the government goes ahead with it.

But that sounds too Machiavellian to be true.

CLSA on top for fourth time

There is considerable joy over at CLSA upon the news that it has been ranked the No1 brokerage for research and sales in Asia for the fourth year running in the Asiamoney 21st annual Brokers Poll 2010, a survey of more than 2,700 institutional investors from 1,400 global institutions.

It secured number one spot in the top four overall categories: No 1 overall combined regional research and sales (ex-Australia and Japan); No 1 overall regional research (ex-Australia and Japan); No 1 overall regional sales (ex-Australia and Japan) and No1 overall regional sales services (ex-Japan). Also, equity strategist Chris Woods was voted the best strategist in Asia for the eighth time since 2002.

CLSA was of course particularly pleased by being voted No1 most independent research brokerage for the eighth time since 2002.

Rivals say they are only able to achieve all this because they don't have a big investment banking operation, which although bringing in loads of money creates so many conflicts of interest. But that would not be entirely true and also sour grapes.

HSBC takes up more space

The odds on HSBC decamping from its London HQ to Hong Kong appear to have lengthened in view of the bank's decision to take three extra floors at its European headquarters in Canary Wharf (pictured). From mid-December, HSBC will occupy a further 2,000 square feet at 1 Canada Square, enough to house 800 people. The move is at odds with the veiled threats from incoming chief executive Stuart Gulliver last month that HSBC would be forced to move out of London if Britain followed through on its promise to tighten the screws on bankers.

Securities and Futures Commission chief Martin Wheatley said in London last week that no London-based financial services firms had spoken to the SFC about moving their HQ to Hong Kong. So a case of more banking bluster.

London still pulls big players

For all the razzmatazz emanating from the stock exchange and interested parties such as investment banks, lawyers and so on about Hong Kong's status as the rising star for raising capital for metals mining and energy companies, London still has appeal for the big players.

The Bumi-Vallar deal last week saw 25 per cent of Indonesian coal mining giant Bumi Resources, valued at US$3 billion, heading for London. Glencore, one of the world's biggest suppliers of commodities and raw materials, is expected to list in London in the first half of next year, although there is some talk of a secondary listing in Hong Kong. Brazilian iron ore giant Vale is working on a secondary Hong Kong listing, while Clive Palmer's Resourcehouse is looking at an initial public offering here.

Nevertheless, London still has the edge in depth of market information, the cost of capital is arguably cheaper, and it is well ahead of Hong Kong on governance and regulatory expertise.