Hong Kong banks warned over harsh vetting for foreign investors
Hong Kong Monetary Authority plans spot checks on banks that fail to comply with guidelines if they refuse accounts
Hong Kong’s de facto central bank yesterday warned local lenders not to overdo it when vetting investors’ applications in the name of reducing risk, as spot checks would be conducted to ensure they followed official banking guidelines.
To make it easier for foreign investors to open accounts in the city, the Hong Kong Monetary Authority also put up a list of banks willing to offer services to foreign small and medium-sized enterprises (SMEs) and start-ups.
The list of more than 20 banks – minus HSBC and Standard Chartered Bank – will be provided to investors through the government’s business promotion arm, InvestHK.
The warning came as the HKMA issued a circular yesterday to all financial institutions reminding them to strike a balance between exercising anti-money laundering and counter-terrorism financing controls and providing business-friendly banking services to foreign investors.
The Post previously reported concerns raised by the city’s 29 chambers of commerce over foreign investors encountering trouble when opening as well as retaining company bank accounts in Hong Kong.
Banks say they are enforcing stricter international anti-fraud regulations to protect the city’s status as a global business centre.