The Securities and Futures Commission yesterday conceded its licensing system might not have kept pace with the times and said it would launch a thorough review of licensing criteria in the second half of the year. SFC intermediaries and investment products executive director Andrew Proctor said the review would consider whether separate licences would need to be introduced for corporate advisers and those working in the Mandatory Provident Fund industry. Senior investment bankers have criticised the SFC for not having a specific licence for corporate advisers, an industry that has grown rapidly in Hong Kong in the past decade. Mr Proctor said there were concerns that the licensing criteria 'did not reflect what was going on in practice'. 'Over the years, there have been changes in the profile of the industry, so as part of keeping up, we will take a review of the entire licensing system,' he said. Mr Proctor, who is charged with overseeing the health of Hong Kong's broking industry, said he would be surprised if there were more broker collapses in coming months. 'I won't say that there won't be any closures with times tough as they are, but I am confident that the broking community has the resilience to withstand it,' Mr Proctor said. The regulator stepped up inspections of brokers' internal risk controls to ensure they had minimised the chance of malpractice. He said only 'a relatively small number of brokers' encountered financial difficulties despite a dramatic drop in market turnover since August last year. 'This is a difficult time for investors and for brokers,' he said. Mr Proctor replaced former deputy chairman Michael Wu Wai-chung as head of intermediaries at the start of the year. Mr Proctor saved his strongest comments for market players who were yet to come to terms with the millennium bug. 'Many of them have not taken even preliminary steps in getting ready for the problems of the millennium bug,' he said. He said the SFC would consider imposing trading restrictions and even restrictions on the movement of a company's assets if they did not deal with the millennium bug problem with sufficient speed. In conjunction with the two exchanges and a team of consultants, the SFC would conduct special inspections of registered entities to monitor their preparation for 2000, he said. Mr Proctor said yesterday that the regulator would also conduct regular meetings with the Mandatory Provident Fund Authority to ensure that there would be minimum overlap of their supervisory roles.