Fund confirms $3.1b equity purchases held in last decade

The Exchange Fund held $3.1 billion in shares in the 1980s but sold its stakes earlier this decade, Secretary for Financial Services Rafael Hui Si-yan revealed yesterday.

In a written reply to legislator Albert Ho Chun-yan, who asked whether the Government had bought stocks and futures contracts before the August market intervention, Mr Hui confirmed the Exchange Fund had bought and held shares through the Development Loan Fund.

They included 20 per cent of Cable & Wireless between 1981 and 1988, which was converted into 6.78 per cent of Hongkong Telecom in 1988.

The stake was eventually sold off in 1990.

It also held 10 per cent of Hong Kong Air Cargo Terminals from 1983 to 1992 and 16.88 per cent of Hong Kong Building & Loan Agency from 1983 to 1991.

From 1983 to 1991, the Government also held a 24.33 per cent stake in Cross-Harbour Tunnel.

The Government, through the Exchange Fund, took over financially troubled Hang Lung Bank in 1984 and Overseas Trust Bank in 1985.