Fears that formation of a credit information bureau could result in client information leaking to other banks are worrying the Hong Kong Association of Banks (HKAB), Hong Kong Monetary Authority (HKMA) deputy-chief executive David Carse says.
While in favour of setting up the bureau, aimed at reducing bad debts incurred on credit cards and personal loans, the HKAB had expressed concern to the HKMA about possible leaks.
The HKAB had also pointed out that personal loan bad debts were not so serious in Hong Kong as to warrant a credit bureau.
Mr Carse said it would be better to set up the credit bureau before bad-debt problems appeared.
'As personal loans are becoming more important to banks, it is necessary to let banks get credit information of applicants through the credit bureau.' Mr Carse said the authority would monitor a futures exchange scheme to create a special membership for banks.
'Banks will need to follow all market risks and internal controls if they are involved in derivative products trading on the futures exchange. 'However, I believe it will not be a big problem, because banks are already doing a lot of OTC derivatives products,' he said. ENOCH YIU
