Regulatory Alerts2017-02-14
Added · Updated
Clarification of sections 22.5 and 22.12 of the Code of Banking Practice
The Hong Kong Monetary Authority issued this letter to clarify supervisory expectations regarding sections 22.5 and 22.12 of the Code of Banking Practice following complaints about their misinterpretation by authorized institutions. The regulator mandates that institutions allow customers and banks to mutually agree on reasonable insurance amounts for mortgaged properties rather than restricting choices to specific examples, and requires clear disclosure of legal expenses for both parties. Authorized institutions must immediately amend customer communication materials and strengthen staff training to ensure correct implementation of these transparency and flexibility requirements.
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