Regulatory Alerts2011-05-09
Added · Updated
Renminbi (RMB) Fiduciary Account Arrangement
The Hong Kong Monetary Authority clarifies that exposures under the Renminbi fiduciary cash account are exempt from the large exposures limit in section 81 of the Banking Ordinance. This exemption applies because the arrangement shifts counterparty credit risk to the People's Bank of China, which is classified as a government entity under the Ordinance. The ruling resolves a clarification request from the Hong Kong Association of Banks regarding the regulatory treatment of these clearing and settlement exposures.
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