Yuen named HKMA chief's new right-hand man
The government has promoted Arthur Yuen Kwok-hang, currently an executive director at the Hong Kong Monetary Authority, to head its local banking regulation division starting in January.
Mr Yuen will become a deputy chief executive of the HKMA, replacing Choi Yiu-kwan, who will retire at the end of this year.
In effect, Mr Yuen will be the new right-hand man to Norman Chan Tak-lam, who will replace HKMA chief executive Joseph Yam Chi-kwong when he retires on October 1.
Bankers and analysts said Mr Yuen was chosen because of his strong regulatory background in the securities market, especially important as the HKMA begins to tighten regulations on banks' securities operations after the Lehman Brothers minibond fiasco.
More than 20,000 investors complained they were misled by banks into buying the structured products issued or guaranteed by Lehman. These products became almost worthless when the United States investment bank collapsed in September last year.
This prompted the HKMA to impose a range of measures to tighten regulation on how banks sell their securities business.
Mr Yuen is a former administrative officer and was principal assistant secretary for the Financial Services Branch in the early 1990s handling securities market regulation. He was a senior manager at the Securities and Futures Commission for two years before he joined the HKMA as a division head in 1996. He was promoted to his current post in 2004.
'Mr Yuen has experience in securities regulation that will be useful as the HKMA now needs to tighten the regulation of banks' securities business,' said Chim Pui-chung, a legislator for brokers.
However, Democrat Kam Nai-wai objected to the timing of the management changes. He said it was not appropriate for Mr Yam and Mr Choi to leave before the investigation into the minibond complaints was completed in March next year.
'Mr Choi is handling banking regulation, so he is the one who knows best if there was any mis-selling by the banks,' Mr Kam said.
Mr Choi, 54, joined the HKMA in 1993 after working for the Office of the Commissioner of Banking since 1974. He handled a number of bank runs and government rescue plans in the 1980s.
He rejected market speculation that his departure was related to the retirement of Mr Yam, saying he had always planned to retire at 55 by the end of this year.
'Norman is a good friend of mine and a good colleague,' Mr Choi said. 'I struggled for a while before making the decision to retire.'
Mr Choi said he would not join the commercial world after retiring from the HKMA but would study history and spend time with his family.
Tam Ping-shing, chief executive of Hong Leong Bank's Hong Kong branch, said he regretted that such an experienced banking regulator had to retire.
'One of Mr Yuen's challenges is to make sure local banking regulation can cope with the challenges ahead and to allow local lenders to expand on the mainland in future,' Mr Tam said.
