Banking (Disclosure) Rules
(Enacting provision omitted—E.R. 1 of 2012)
[1 January 2007] L.N. 232 of 2006
(Format changes—E.R. 1 of 2012)
(Omitted as spent—E.R. 1 of 2012)
In these Rules, unless the context otherwise requires—
annual reporting period (周年報告期), in relation to an authorized institution, means a financial year of the institution; (L.N. 195 of 2016) capital requirements (資本規定), in relation to— (a)the measure of an authorized institution’s non-securitization exposures to credit risk calculated in accordance with any one or more of Parts 4, 5 and 6 and Division 4 of Part 6A of the Capital Rules, as the case requires; (L.N. 168 of 2023) (b)the measure of an authorized institution’s securitization exposures to credit risk calculated in accordance with Part 7 of the Capital Rules; (L.N. 168 of 2023) (c)the measure of an authorized institution’s sovereign concentration risk calculated in accordance with Part 10 of the Capital Rules; and (L.N. 168 of 2023; L.N. 151 of 2025) (d)the measure of an authorized institution’s cryptoasset exposures to credit risk calculated in accordance with section 376 and Divisions 5, 6 and 8 of Part 12 of the Capital Rules, (L.N. 151 of 2025) means the amount of capital required to be held by the institution for that risk based on the risk-weighted amount for that risk multiplied by 8%; Capital Rules (《資本規則》) means the Banking (Capital) Rules (Cap. 155 sub. leg. L); CB ratio (CB比率) has the meaning given by section 3E(1) of the Capital Rules; (L.N. 77 of 2018) CCyB ratio (CCyB比率) has the meaning given by section 3E(1) of the Capital Rules; (L.N. 77 of 2018) certificate of deposit (存款證) means any certificate of deposit (including a certificate of deposit held for trading purposes) regardless of maturity; debt securities (債務證券) means any negotiable securities other than loan capital, shares, stocks, certificates of deposit or import or export trade bills; (L.N. 52 of 2013) delta-weighted position (得爾塔加權持倉) has the meaning assigned to it by section 281 of the Capital Rules; disclosure statement (披露報表), in relation to an authorized institution— (a)means, except in Part 8, a disclosure statement prepared by the institution pursuant to section 6(1); (b)means, in Part 8, a disclosure statement prepared by the institution pursuant to section 88(1); exposure measure (風險承擔計量) has the meaning given by section 3Y of the Capital Rules; (L.N. 77 of 2018) financial concerns (金融企業) means— (a)investment companies including—(i)companies in the business of investment in commodity futures, foreign currencies, gold bullion, shares, funds and securities;(ii)unit trusts;(iii)retirement funds; and(iv)investment holding companies; (b)insurance companies; (c)futures brokers; and (d)finance companies and other persons engaged in the financial sector which are not authorized institutions or banks, including companies in the business of leasing, factoring, bills discounting, hire purchase, mortgage finance, commercial and industrial finance, gold bullion brokers, money lenders, pawnshops and credit card companies; foreign currency (非港元貨幣) means any currency other than the Hong Kong dollar; G-SIB has the meaning given by section 3E(1) of the Capital Rules; (L.N. 77 of 2018) geographical segment (地域分部), in relation to an authorized institution, means a business unit of the institution— (a)which is engaged in providing products or services within a particular economic environment; (b)which is subject to risks and returns which are different from those of business units of the institution operating in other economic environments; and (c)which is distinct from other business units of the institution due to factors relating to—(i)similarity of economic and political conditions;(ii)relationships between operations in different geographical areas;(iii)proximity of operations;(iv)special risks associated with operations in a particular area;(v)exchange control regulations;(vi)underlying currency risks; or(vii)any combination of the matters referred to in subparagraphs (i), (ii), (iii), (iv), (v) and (vi); HLA ratio (HLA比率) has the meaning given by section 3E(1) of the Capital Rules; (L.N. 77 of 2018) interim reporting period (中期報告期), in relation to an authorized institution, means the first 6 months of a financial year of the institution; (L.N. 195 of 2016) leverage ratio (槓桿比率) has the meaning given by section 3Y of the Capital Rules; (L.N. 77 of 2018) leverage ratio return (槓桿比率申報表) means the standard return template relating to leverage ratio referred to in section 3ZB(3) of the Capital Rules; (L.N. 77 of 2018) liquidity position return (流動性狀況申報表) means the return relating to liquidity position required to be submitted by an authorized institution to the Monetary Authority under section 63(2) of the Ordinance; (L.N. 160 of 2014) Liquidity Rules (《流動性規則》) means the Banking (Liquidity) Rules (Cap. 155 sub. leg. Q); (L.N. 160 of 2014; E.R. 5 of 2021) loan capital (借貸資本) means subordinated liabilities (including loans, debentures and floating rate notes); loans and advances to banks (對銀行的貸款及放款) means placements with banks which have a residual contractual maturity of more than one year; off-balance sheet exposures (資產負債表外風險承擔), in relation to the leverage ratio of an authorized institution, means the off-balance sheet exposures calculated by using the standard calculation methodology set out in the leverage ratio return; (L.N. 77 of 2018) on-balance sheet exposures (資產負債表內風險承擔), in relation to the leverage ratio of an authorized institution, means the on-balance sheet exposures calculated by using the standard calculation methodology set out in the leverage ratio return; (L.N. 77 of 2018) publish (發布) includes distribute, make available and disseminate; quarterly reporting period (季度報告期), in relation to an authorized institution, means the first, second, third or fourth 3-month period of a financial year of the institution; (L.N. 195 of 2016) reporting date (報告日期), in relation to a disclosure required under these Rules, means the last day of the reporting period to which the disclosure relates; reporting period (報告期) means— (a)an annual reporting period; (b)a semi-annual reporting period; (c)a quarterly reporting period; or (d)an interim reporting period; (L.N. 195 of 2016) repossessed asset (經收回資產), in relation to an authorized institution, means an asset in respect of which the institution has acquired control (whether through court proceedings or otherwise) for the discharge in whole or in part of the obligations of an obligor; semi-annual reporting period (半年度報告期), in relation to an authorized institution, means the first or second 6-month period of a financial year of the institution; (L.N. 195 of 2016) stable funding position return (穩定資金狀況申報表) means the return relating to stable funding position required to be submitted by an authorized institution to the Monetary Authority under section 63(2) of the Ordinance; (L.N. 77 of 2018) trade bills (貿易匯票), in relation to an authorized institution, means all bills of exchange purchased by the institution in relation to trade transactions.(L.N. 52 of 2013; L.N. 195 of 2016; L.N. 77 of 2018)
Section 2 of the Capital Rules applies to the interpretation of these Rules as that section applies to the interpretation of the Capital Rules. (L.N. 77 of 2018)
Rules 2, 17, 39, 54 and 59 of the Liquidity Rules, if applicable, apply to the interpretation of sections 12, 16AB, 16FJ, 16FK, 16FL, 16ZQK, 103, 103A, 103AB, 103AC, 103B and 103C of these Rules as those rules apply to the interpretation of the Liquidity Rules. (L.N. 77 of 2018; L.N. 151 of 2025)
If a conflict arises from the operation of subsections (2) and (2A) in relation to the interpretation of these Rules, the rule that applies under subsection (2A) prevails. (L.N. 77 of 2018)
A disclosure required under these Rules is—
a disclosure to the general public; and
unless the context otherwise requires, a disclosure as at the reporting date.
Unless otherwise approved by the Monetary Authority, if the commencement date of any section, or of any amendment of any section, falls within a reporting period, an authorized institution must comply with that section, or that section as amended, as the case requires, in respect of the required disclosure for the reporting period. (L.N. 168 of 2023)
For the purposes of these Rules, a reference to an authorized institution making a disclosure to the general public includes the institution making the disclosure—
on the institution’s internet website (or a section of the internet website); and
if approved by the Monetary Authority—on the internet website of the institution’s holding company (or a section of the internet website of the institution’s holding company). (L.N. 77 of 2018; L.N. 168 of 2023)
Subject to section 12, the following provisions apply to an authorized institution incorporated in Hong Kong unless it is exempted under subsection (7) or (14A)—
Part 2;
provisions of Part 2A requiring disclosures for each annual reporting period;
the following provisions, in so far as they relate to a quarterly or semi-annual reporting period (as the case requires) that ends at the close of an annual reporting period—
provisions of Part 2A requiring disclosures for each quarterly or semi-annual reporting period;
(Repealed L.N. 77 of 2018)
Part 3;
Part 4. (L.N. 195 of 2016)
Subject to section 12, the following provisions apply to an authorized institution incorporated in Hong Kong unless it is exempted under subsection (8) or (14A)—
the following provisions, in so far as they relate to a quarterly or semi-annual reporting period (as the case requires) that ends otherwise than at the close of an annual reporting period—
provisions of Part 2A requiring disclosures for each quarterly or semi-annual reporting period;
(Repealed L.N. 77 of 2018)
Part 3;
Part 3A. (L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
Part 8 applies to an authorized institution incorporated outside Hong Kong except such an institution which is exempted under subsection (9) or (14A). (L.N. 195 of 2016)
The Monetary Authority may, by notice in writing given to an authorized institution incorporated in Hong Kong, exempt the institution from the application of the provisions specified in subsection (1)(a), (b), (c) and (d) if— (L.N. 195 of 2016)
the institution is a deposit-taking company or restricted licence bank; and
the institution demonstrates to the satisfaction of the Monetary Authority that it meets the following criteria—
it has total assets less provisions of less than $1 billion (or the equivalent amount in any foreign currency); and
it has total deposits from customers of less than $300 million (or the equivalent amount in any foreign currency).
The Monetary Authority may, by notice in writing given to an authorized institution incorporated in Hong Kong, exempt the institution from the application of the provisions specified in subsection (2)(a) and (b) if— (L.N. 195 of 2016)
the institution is exempted under subsection (7) from the application of the provisions specified in subsection (1)(a), (b), (c) and (d); or (L.N. 195 of 2016)
the institution—
is not listed on The Stock Exchange of Hong Kong Limited; and
is a wholly owned subsidiary of an authorized institution incorporated in Hong Kong.
For the purposes of subsection (6), the Monetary Authority may, by notice in writing given to an authorized institution incorporated outside Hong Kong, exempt the institution from the application of Part 8 if the institution demonstrates to the satisfaction of the Monetary Authority that it meets the following criteria—
its local branches, together with its principal place of business in Hong Kong, have in aggregate total assets less provisions of less than $10 billion (or the equivalent amount in any foreign currency); and
its local branches, together with its principal place of business in Hong Kong, have in aggregate total deposits from customers of less than $2 billion (or the equivalent amount in any foreign currency).
For the purposes of determining whether or not an authorized institution meets the criteria referred to in subsection (7)(b) or (9), the Monetary Authority shall make reference to the relevant average of the relevant figures over the relevant period of the institution.
Where the Monetary Authority has determined that an authorized institution is not exempted under subsection (7) because the institution does not meet the criteria referred to in subsection (7)(b), the institution shall not subsequently be exempted under subsection (7) unless—
the Monetary Authority makes a subsequent determination that the institution is exempted under subsection (7); and
the institution submits to the Monetary Authority a business plan, within a period reasonable in all the circumstances of the case, which—
demonstrates to the satisfaction of the Monetary Authority that, if the plan were implemented by the institution, it would be unlikely that the institution would cease to meet the criteria referred to in subsection (7)(b) during the period referred to in subparagraph (ii); and
covers such an appropriate period in the future that the Monetary Authority is satisfied that it would be unlikely that the institution would cease to meet the criteria referred to in subsection (7)(b) in the foreseeable future.
Where the Monetary Authority is satisfied that an authorized institution which is exempted under subsection (7) ceases to fall within the description of subsection (7)(a) or ceases to meet the criteria referred to in subsection (7)(b), the Monetary Authority may, by notice in writing given to the institution, inform the institution that it ceases to be so exempted from the date specified in the notice.
Where the Monetary Authority is satisfied that an authorized institution which is exempted under subsection (8) ceases to fall within the description of subsection (8)(a) or (b), the Monetary Authority may, by notice in writing given to the institution, inform the institution that it ceases to be so exempted from the date specified in the notice.
Where the Monetary Authority is satisfied that an authorized institution which is exempted under subsection (9) ceases to meet the criteria referred to in that subsection, the Monetary Authority may, by notice in writing given to the institution, inform the institution that it ceases to be so exempted from the date specified in the notice.
The Monetary Authority may, by notice in writing given to an authorized institution, exempt the institution from the application of these Rules if the Monetary Authority is satisfied that the institution has not commenced business. (L.N. 195 of 2016)
If the Monetary Authority is satisfied that an authorized institution which is exempted under subsection (14A) has commenced business, the Monetary Authority may, by notice in writing given to the institution, inform the institution that it ceases to be so exempted from the date specified in the notice. (L.N. 195 of 2016)
(Repealed L.N. 77 of 2018)
In this section—
relevant average (有關平均數), in relation to the relevant figures for an authorized institution, means the arithmetic mean of the relevant figures as at the end of each calendar month for the last relevant period of the institution; relevant figures (有關數字), in relation to an authorized institution, means the figures as at the end of each calendar month relating to the institution’s total assets less provisions and total deposits from customers, as set out in the return relating to assets and liabilities submitted by the institution to the Monetary Authority for each calendar month pursuant to section 63 of the Ordinance; relevant period (有關期間), in relation to an authorized institution, means each period of 12 calendar months ending on and including the fifth calendar month preceding the close of the institution’s financial year.(Format changes—E.R. 1 of 2012)
Unless the context otherwise requires, a reference to an authorized institution in this Part is a reference to an authorized institution to which this Part applies under section 3(1).
An authorized institution must have in place, within 6 months after the date on which it became an authorized institution or such longer period as the Monetary Authority may specify, a clearly documented disclosure policy— (L.N. 195 of 2016)
which sets out—
the approach used by the institution—
to determine the content, appropriateness and frequency of the information it discloses to the general public relating to its state of affairs, including its profit and loss and its financial resources (including capital resources and liquidity resources); and (L.N. 52 of 2013)
to ensure that such information it discloses is relevant and adequate to convey an accurate impression of the institution’s actual risk profile; and (L.N. 138 of 2011)
the institution’s internal controls over its process for making such disclosures (including internal controls for verifying or reviewing the accuracy of the information disclosed); and
which is subject to regular and independent review and approval by the institution’s senior management and board of directors. (L.N. 168 of 2023)
(L.N. 195 of 2016; L.N. 77 of 2018)
Subject to section 16FE(1)(b) and (2), if an authorized institution is required under these Rules to disclose information (however described), it must make that disclosure by— (L.N. 52 of 2013; L.N. 195 of 2016; L.N. 77 of 2018)
preparing, in the Chinese and English languages, a disclosure statement— (L.N. 195 of 2016)
that, subject to subsection (1A) and section 15, is in the form exclusively of a standalone document or a discrete section of the institution’s financial statements; and
in which the information required to be disclosed is readily identifiable; (L.N. 195 of 2016)
subject to subsection (1A) and section 15, presenting the information required to be disclosed in the format, and using the standard disclosure templates or tables (if applicable), specified by the Monetary Authority; and (L.N. 195 of 2016; L.N. 77 of 2018)
(Repealed L.N. 195 of 2016)
complying with the other provisions of this section applicable to or in relation to the statement.
If it is so permitted by the Monetary Authority in specification under subsection (1)(ab) and if all the conditions specified in subsection (1B) are met, any part of the information required to be disclosed may be contained in a separate document that is signposted in the standalone document or the discrete section of the authorized institution’s financial statements (discrete section). (L.N. 195 of 2016)
The conditions are—
that the authorized institution signposts clearly, in the standalone document or the discrete section, the location where the information published elsewhere is published, providing, at a minimum, the following information—
a reference to the format and templates specified by the Monetary Authority to which the signposting relates;
the full title of the separate document in which the information is published;
a link to the relevant section of the institution’s internet website where the separate document can be accessed (if applicable); and (L.N. 77 of 2018)
the page and paragraph number of the separate document where the information is located; and
that the level of assurance on the reliability of data in the separate document is equivalent to, or greater than, the internal assurance level required for the information presented in the standalone document or the discrete section. (L.N. 195 of 2016)
For disclosures under Part 2A for a quarterly reporting period that ends otherwise than at the close of an interim or annual reporting period, the authorized institution must publish the disclosure statement— (L.N. 77 of 2018)
if the authorized institution publishes its quarterly financial statements for the quarterly reporting period (quarterly financial statements) within 8 weeks after the end of the quarterly reporting period—concurrently with the publication of the quarterly financial statements; or
if the authorized institution does not publish the quarterly financial statements within 8 weeks after the end of the quarterly reporting period—within that 8-week period. (L.N. 195 of 2016)
For disclosures under Part 2A, 3 or 3A for a reporting period that is, or ends at the close of, an interim reporting period, the authorized institution must publish the disclosure statement— (L.N. 77 of 2018)
if the authorized institution publishes its interim financial statements for the interim reporting period (interim financial statements) within 3 months after the end of the quarterly, semi-annual or interim reporting period to which the disclosure statement relates (specified reporting period)— (L.N. 77 of 2018)
concurrently with the publication of the interim financial statements; or
if a permission is given under subsection (1F)—within the time permitted; or (L.N. 77 of 2018)
if the authorized institution does not publish the interim financial statements within 3 months after the end of the specified reporting period—within that 3-month period. (L.N. 195 of 2016)
For disclosures under Part 2A, 3 or 4 for a reporting period that is, or ends at the close of, an annual reporting period, the authorized institution must publish the disclosure statement— (L.N. 77 of 2018)
if the authorized institution publishes its annual financial statements for the annual reporting period (annual financial statements) within 4 months after the end of the quarterly, semi-annual or annual reporting period to which the disclosure statement relates (specified reporting period)— (L.N. 77 of 2018)
concurrently with the publication of the annual financial statements; or
if a permission is given under subsection (1F)—within the time permitted; or (L.N. 77 of 2018)
if the authorized institution does not publish the annual financial statements within 4 months after the end of the specified reporting period—within that 4-month period. (L.N. 195 of 2016)
Subject to subsection (1G), the Monetary Authority may, by notice in writing given to an authorized institution, permit the publication of a disclosure statement under subsection (1D)(a) or (1E)(a) by the institution at a time later than the publication of the interim financial statements or annual financial statements (as the case requires) but within the following period after the end of the reporting period to which the disclosure statement relates—
if subsection (1D)(a) applies—3 months;
if subsection (1E)(a) applies—4 months. (L.N. 77 of 2018)
The Monetary Authority may give a permission under subsection (1F) if the authorized institution demonstrates to the satisfaction of the Monetary Authority that—
concurrent publication under subsection (1D)(a)(i) or (1E)(a)(i) is not practicable or feasible, or will result in a delay in the publication of the relevant financial statements; and
the proposed difference in time between the publication of the relevant financial statements and the publication of the disclosure statement is reasonable in all the circumstances of the case. (L.N. 77 of 2018)
An authorized institution shall make it clear in its disclosure statement which information contained in the statement has been audited and which information contained in the statement has not been audited.
An authorized institution must ensure that when its disclosure statement is published—
the statement contains all the disclosures required under these Rules to be made by the institution for the reporting periods to which the statement relates; and
the disclosures referred to in paragraph (a) are not false or misleading in any material respect. (L.N. 195 of 2016)
An authorized institution must ensure that when its disclosure statement for an annual reporting period is published, the statement—
describes the key elements of its disclosure policy referred to in section 5; or
provides a cross-reference to another location where the description referred to in paragraph (a) is readily accessible by the general public. (L.N. 195 of 2016)
(Repealed L.N. 77 of 2018)
An authorized institution shall lodge a copy of its disclosure statement with the Monetary Authority before it publishes the statement.
The Monetary Authority shall keep each copy of a disclosure statement lodged with it pursuant to subsection (5) with the register.
Subject to subsection (8), an authorized institution shall— (L.N. 195 of 2016)
keep at least one copy of each of its disclosure statements (relevant copy) in its principal place of business in Hong Kong; and (L.N. 77 of 2018)
make a relevant copy available for inspection by the general public during the business hours of the institution at its principal place of business in Hong Kong. (L.N. 77 of 2018)
If an authorized institution publishes a disclosure statement containing the disclosures referred to in subsection (3)(a), it must ensure that the statement is available for inspection under subsection (7) for at least 12 months beginning on the date of publication of the statement. (L.N. 195 of 2016; L.N. 77 of 2018)
(Repealed L.N. 195 of 2016)
An authorized institution— (L.N. 77 of 2018)
must establish and maintain an archive of all disclosure statements relating to reporting periods ending on or after 30 June 2013; and
unless otherwise approved by the Monetary Authority, must establish and maintain the archive—
on the institution’s internet website; or
if an approval is given under section 2(4)(b)—on the internet website of the institution’s holding company. (L.N. 77 of 2018; L.N. 168 of 2023)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
The board of directors (or a committee designated by the board) and the senior management of an authorized institution shall ensure that the information which the institution is required to disclose pursuant to these Rules is, before being so disclosed, scrutinized and subjected to an internal review to ensure that the information is not false or misleading in any material respect. (L.N. 195 of 2016)
The internal review referred to in subsection (1) shall be carried out by an authorized institution’s adequately qualified personnel who are independent of the institution’s staff or management responsible for preparing the information which the institution is required to disclose pursuant to these Rules.
An authorized institution must ensure that one or more members of the senior management of the institution attest in writing that the disclosures made by the institution pursuant to these Rules have been prepared in accordance with the internal review and internal control processes approved by the institution’s board of directors. (L.N. 195 of 2016)
The internal review and internal control processes applied to the information disclosed by an authorized institution under these Rules for a reporting period that is, or ends at the close of, an interim or annual reporting period must be no less stringent than those applied to the information provided by the institution within the management discussion and analysis part of its financial statements. (L.N. 195 of 2016)
An authorized institution may, with the prior consent of the Monetary Authority, decline to disclose proprietary or confidential information the disclosure of which would otherwise be required pursuant to a requirement of these Rules (referred to in this subsection as the relevant requirement) if the institution—
discloses general information relating to the subject matter of the relevant requirement in its disclosure statement (whether or not pursuant to the relevant requirement); and
includes a statement in that disclosure statement stating what information it has declined to disclose pursuant to this section.
In this section—
proprietary or confidential information (專有或機密資料), in relation to an authorized institution, means information—(a)which, if it became publicly available, would cause serious prejudice to the competitive position of the institution; or(b)in respect of which the institution has legally binding obligations to its customers or other counterparties which prevent the institution from disclosing the information.The senior management of an authorized institution shall ensure that a disclosure made by the institution pursuant to these Rules contains all the material information.
In this section—
material information (重要資料) means information—(a)which is required to be disclosed under these Rules; and(b)which, if it were not disclosed or were misstated, could change or influence the assessment or decision of a person relying on the disclosure concerned for the purposes of making investment or other economic decisions.Subject to subsections (2), (3), (4) and (5), a disclosure made pursuant to these Rules by an authorized institution applies to the institution on a consolidated basis whether or not the institution is also required to calculate its capital adequacy ratio on a solo basis or solo-consolidated basis pursuant to the Capital Rules.
Subsection (1) does not apply to an authorized institution which is only required to calculate its capital adequacy ratio on a solo basis pursuant to the Capital Rules.
Subsection (1) does not operate to prevent an authorized institution from making a disclosure pursuant to these Rules on a solo basis or solo-consolidated basis, as the case requires, in addition to a consolidated basis if the institution reasonably believes that to do so would provide greater clarity in understanding the institution’s state of affairs, including its profit and loss and its financial resources (including capital resources and liquidity resources), for persons relying on the disclosures. (L.N. 52 of 2013)
Subsection (1) does not apply to disclosures required to be made by an authorized institution pursuant to section 16FJ, 16FK, 16FL, 16ZQK, 23, 25, 26, 27, 28, 29, 29B, 35, 44, 46, 47 or 52. (L.N. 77 of 2018; L.N. 151 of 2025)
Subject to subsection (6), a disclosure required to be made by an authorized institution pursuant to any of the sections set out in subsection (4) must be made on the basis of preparation (whether fully consolidated or unconsolidated) which the institution believes is most appropriate for the purposes of providing clarity in understanding the institution’s state of affairs, including its profit and loss and its financial resources (including capital resources and liquidity resources), for persons relying on the disclosures required by those sections, including (where appropriate) the basis used by the institution for accounting purposes for the reporting period to which the disclosure relates. (L.N. 52 of 2013; L.N. 195 of 2016; L.N. 77 of 2018)
A disclosure required to be made by an authorized institution pursuant to any of sections 16FJ, 16FK, 16FL, 16ZQK, 28 and 29 must be made on the same basis as that used by the institution to prepare the return respectively referred to in those sections. (L.N. 195 of 2016; L.N. 77 of 2018; L.N. 151 of 2025)
An authorized institution shall make disclosures pursuant to these Rules on the basis of—
subject to paragraphs (b) and (c), the approach it uses under the Capital Rules to calculate its regulatory capital or capital charge for credit risk, market risk, CVA risk or operational risk, as the case requires;
subject to paragraph (c), if it uses a combination of 2 or more approaches under the Capital Rules to calculate its regulatory capital or capital charge for credit risk, market risk, CVA risk or operational risk, the respective approach it uses for each of its exposure classes, business units, risk categories, or parts of its business, as the case requires;
if it has, during any one reporting period, used different approaches under the Capital Rules to calculate its regulatory capital or capital charge for credit risk, market risk, CVA risk or operational risk for the same exposure class, business unit, risk category, or part of its business, the respective approach it uses for each of its exposure classes, business units, risk categories, or parts of its business, as the case requires, as at the reporting date for that period. (L.N. 195 of 2016; L.N. 168 of 2023)
If an authorized institution is exempted, under the Capital Rules, from the requirement to calculate its capital requirements or capital charge for its credit risk, market risk, CVA risk or operational risk (as the case requires), the institution— (L.N. 168 of 2023)
is not required to make disclosures pertaining to the approach; but
must disclose that fact. (L.N. 195 of 2016; L.N. 77 of 2018)
If an authorized institution is not required, under the Liquidity Rules, to calculate one or more of the LCR, LMR, NSFR or CFR (excluded ratios) for its liquidity risk, the institution—
is not required to make disclosures pertaining to the excluded ratios; but
must disclose that fact. (L.N. 77 of 2018)
(Repealed L.N. 195 of 2016)
An authorized institution must make disclosures pursuant to Part 2A for each annual, semi-annual and quarterly reporting period, as that Part requires.
(Repealed L.N. 77 of 2018)
An authorized institution must make disclosures pursuant to Part 3 for each semi-annual reporting period. (L.N. 77 of 2018)
An authorized institution must make disclosures pursuant to Part 3A for each interim reporting period.
An authorized institution must make disclosures pursuant to Part 4 for each annual reporting period.
An authorized institution may treat disclosures (referred to in this section as foreign disclosures) made by its parent bank, if any, as being part of the disclosures (referred to in this section as local disclosures) the institution is required to make pursuant to these Rules if the institution demonstrates to the satisfaction of the Monetary Authority that—
the foreign disclosures are not materially different from the local disclosures;
the foreign disclosures are prepared in accordance with the prevailing banking supervisory standards relating to disclosure issued by the Basel Committee and adopted by the relevant banking supervisory authority of the parent bank; (L.N. 52 of 2013)
the characteristics of the institution’s relevant risk exposures subject to requirements of these Rules are not materially different from those of the relevant risk exposures of the parent bank;
the foreign disclosures provide a sufficient level of detail on the range of risks incurred by the institution and on how those risks are managed to permit third parties to form a considered view of the relevant aspects of the institution’s operations;
the disclosure statement of the institution contains a statement of the location where all the foreign disclosures can be found;
the foreign disclosures are set out on an internet website of the parent bank which is accessible by the general public; and (L.N. 77 of 2018)
the institution has an internet website (or section of an internet website) which— (L.N. 195 of 2016; L.N. 77 of 2018)
is specifically intended to be accessible by the general public in Hong Kong; and
contains a link to the section of the parent bank’s internet website setting out the foreign disclosures as referred to in paragraph (f). (L.N. 195 of 2016; L.N. 77 of 2018)
An authorized institution shall, in addition to the disclosures it is required to make pursuant to any other provisions of these Rules, include in its disclosure statement such other information that it is necessary to so include to ensure that—
the information contained in the statement is not false or misleading in any material respect; and
the operations of the institution are clearly explained.
Notwithstanding any other provisions of these Rules, where it is not practicable for an authorized institution to make a disclosure required under these Rules for reasons not related to section 9, the institution—
shall, after consultation with the Monetary Authority, include in its disclosure statement—
a statement that it is so unable and of the reasons why it is so unable; and
information which is the closest available alternative to the information which would have been the subject of those disclosures if the institution had not been so unable; and
shall not publish the disclosure statement except with the prior consent of the Monetary Authority.
(Part 2A added L.N. 195 of 2016)
Unless the context otherwise requires, a reference to an authorized institution in a provision of this Part—
requiring—
disclosures for an annual reporting period; or
disclosures for a quarterly or semi-annual reporting period, in so far as the provision relates to such a period that ends at the close of an annual reporting period,
is a reference to an authorized institution to which the provision applies under section 3(1); and
requiring disclosures for a quarterly or semi-annual reporting period, in so far as the provision relates to such a period that ends otherwise than at the close of an annual reporting period, is a reference to an authorized institution to which the provision applies under section 3(2).
An authorized institution must disclose, for each quarterly reporting period (relevant reporting period)— (L.N. 168 of 2023)
each of the following ratios that it is required to calculate for the purposes of the Capital Rules or the Liquidity Rules (as applicable) (each referred to in this section as a key prudential ratio)—
CET1 capital ratio;
Tier 1 capital ratio;
Total capital ratio;
pre-floor capital ratios; (L.N. 168 of 2023)
leverage ratio;
mean-SFT adjusted leverage ratio; (L.N. 168 of 2023)
LCR;
LMR;
NSFR;
CFR;
CB ratio;
CCyB ratio;
HLA ratio;
for each key prudential ratio other than the LMR, CFR, CB ratio, CCyB ratio and HLA ratio—the numerator and the denominator used for calculating the ratio;
for each key prudential ratio—comparative figures for each of the 4 quarterly reporting periods before the relevant reporting period; and
for each key prudential ratio—an explanation of any material changes during the relevant reporting period, including key drivers of those changes.
In this section—
mean-SFT adjusted leverage ratio (經調整平均證券融資交易槓桿比率), in relation to an authorized institution, means a ratio determined in the same way as the institution’s leverage ratio, except that the institution’s exposures arising from SFTs used in the calculation of the exposure measure are based on the arithmetic mean of the gross amount of SFT assets (after adjustment for sale accounting transactions and netted amounts of associated cash payables and cash receivables) as of each day of the quarterly reporting period; pre-floor capital ratios (下限前資本比率), in relation to an authorized institution, means the pre-floor CET1 capital ratio, the pre-floor Tier 1 capital ratio and the pre-floor Total capital ratio that are determined in the same way as the institution’s CET1 capital ratio, Tier 1 capital ratio and Total capital ratio under subsection (1)(a)(i), (ii) and (iii) respectively, except that the risk-weighted amount used for calculating the pre-floor ratios excludes any adjustments required for meeting the output floor requirement specified in Part 11 of the Capital Rules. (L.N. 168 of 2023)An authorized institution must disclose, for each annual reporting period, a description of—
its risk management objectives and policies; and
how the board of directors and senior management of the institution assess and manage risks,
that is necessary or relevant for understanding its risk tolerance or appetite in relation to its main activities and all significant risks inherent in or associated with those activities. (L.N. 77 of 2018)
An authorized institution must disclose, for each quarterly reporting period—
an overview of its capital requirements by providing a breakdown of its total risk-weighted amount forming the denominator of the capital requirements; and (L.N. 77 of 2018)
an explanation of any material changes in the matters referred to in paragraph (a) during the quarterly reporting period.
An authorized institution must disclose, for each annual reporting period, information on its assets and liabilities that is necessary or relevant for identifying the differences between— (L.N. 77 of 2018)
the scope of accounting consolidation applicable to the institution; and
the scope of regulatory consolidation applicable to the institution.
The disclosure under subsection (1) must include a breakdown into regulatory risk categories of every item of the assets and liabilities reported in the institution’s financial statements based on the scope of accounting consolidation applicable to the institution.
An authorized institution must disclose, for each annual reporting period, information on the main sources of differences between—
the carrying value amounts in its financial statements; and
the exposure amounts used to calculate its capital requirements,
in respect of its assets and liabilities based on the scope of regulatory consolidation applicable to the institution.
An authorized institution must disclose, for each annual reporting period, qualitative explanations of the differences disclosed under sections 16D and 16E.
An authorized institution must disclose, for each annual reporting period—
a breakdown of prudent valuation adjustments required by type of financial instruments, and allocation of these adjustments between the banking book and the trading book (if applicable); and
an explanation of any material changes in the amount of prudent valuation adjustments referred to in paragraph (a) during the reporting period, including key drivers of those changes.
(Division 3A added L.N. 77 of 2018)
An authorized institution must disclose, for each semi-annual reporting period—
a breakdown of the constituent elements of its Total capital; and
an explanation of any material changes in the matters referred to in paragraph (a) during the reporting period, including key drivers of those changes.
An authorized institution must disclose, for each semi-annual reporting period—
a full reconciliation between—
the composition of its regulatory capital; and
its balance sheet in its published financial statements; and
an explanation of any material changes in the matters referred to in paragraph (a) during the reporting period, including key drivers of those changes.
An authorized institution must disclose, for each semi-annual reporting period—
the basis of consolidation including—
an outline of the differences between the accounting scope of consolidation and the regulatory scope of consolidation;
a list of—
the institution’s subsidiaries (if any) that are included in the accounting scope of consolidation but not included in the regulatory scope of consolidation;
the institution’s subsidiaries (if any) that are included in the regulatory scope of consolidation but not included in the accounting scope of consolidation; and
the institution’s subsidiaries (if any) that are included in both the accounting scope of consolidation and the regulatory scope of consolidation if the methods of consolidation differ between those 2 scopes, and an explanation of the differences in the 2 methods of consolidation;
if the institution’s shareholdings in any of its subsidiaries are deducted from the institution’s CET1 capital—a list of those subsidiaries; and
a description of the principal activities of each of the subsidiaries mentioned in subparagraphs (ii)(A), (B) and (C) and (iii), including the amount of total assets and the amount of total equity reported in the financial statements of each subsidiary; and
any restrictions, or other major impediments, on the transfer of funds or regulatory capital between the members of the institution’s consolidation group, including any relevant regulatory, legal or taxation constraints on the transfer of funds or capital.
An authorized institution must disclose, for each semi-annual reporting period—
the main features of the CET1 capital instruments, Additional Tier 1 capital instruments and Tier 2 capital instruments issued by it, as applicable, that are included in its regulatory capital (each referred to in this section as a relevant instrument); and
a direct link to the relevant section of its internet website where the full terms and conditions of all relevant instruments can be found.
Whenever—
a relevant instrument—
is issued and included in an authorized institution’s capital base;
is repaid; or
is excluded from an authorized institution’s capital base; or
there is a redemption, conversion or write-down, or any other material change in the nature, of a relevant instrument included in an authorized institution’s capital base,
the institution must, as soon as practicable, update the disclosures it has made under subsection (1) in order to reflect the changes arising from the event referred to in paragraph (a) or (b).
(Division 3B added L.N. 77 of 2018)
This section applies to an authorized institution if—
it is or has been designated under section 3S of the Capital Rules as a G-SIB either in—
the current annual reporting period; or
the annual reporting period immediately preceding the current annual reporting period; or
a direction is given to it under subsection (2).
The Monetary Authority may give a direction to an authorized institution for the purposes of subsection (1)(b) if—
the institution or, if applicable, its consolidation group and any subsidiaries of the institution that are not included in the consolidation group but are insurance firms had, as at 31 December immediately preceding the current annual reporting period, an exposure measure exceeding Euro 200 billion or equivalent (using the exchange rate for that day as prescribed by the Basel Committee); or (L.N. 168 of 2023)
the Monetary Authority, having regard to the characteristics of the institution, reasonably believes that the institution would be capable of having a significant impact on the effective working and stability of the global financial system were the institution to become non-viable.
An authorized institution must disclose an overview of the indicators regarding its systemic importance as specified in subsection (4) for—
the annual reporting period immediately preceding the current annual reporting period; or
if permitted by the Monetary Authority—the current annual reporting period.
The indicators are, if applicable—
the authorized institution’s cross-jurisdictional activities;
its size;
the interconnectedness between the institution and other financial institutions;
its substitutability, including its role in the financial institution infrastructure; and
its complexity.
An authorized institution must base its disclosures on the position as at—
the end of the annual reporting period immediately preceding the current annual reporting period; or
if permitted by the Monetary Authority—another date.
If an authorized institution, having made disclosures under subsection (3) for a reporting period, restates the figures for the indicators specified in subsection (4) on the Monetary Authority’s direction or on its own volition, the institution—
must make an additional disclosure to reflect the restated figures as soon as practicable; and
must disclose, in the disclosure statement relating to the reporting period in which the restatement is made, the fact of the restatement and the restated figures.
An authorized institution must disclose, for each semi-annual reporting period, an overview of the geographical distribution of its private sector credit exposures that are relevant in the calculation of its CCyB ratio.
In subsection (1)—
private sector credit exposures (私人機構信用風險承擔) has the meaning given by section 3N of the Capital Rules.(Division 3C added L.N. 77 of 2018)
An authorized institution must disclose, for each semi-annual reporting period—
a summary comparison reconciling the institution’s balance sheet assets as stated in its financial statements with the exposure measure for the corresponding period disclosed under section 16FI; and
an explanation of any material changes in the matters referred to in paragraph (a) during the reporting period, including key drivers of those changes.
An authorized institution must disclose, for each quarterly reporting period— (L.N. 168 of 2023)
the following information—
its leverage ratio;
the minimum leverage ratio applicable to it;
a breakdown of the components of the exposure measure determined in accordance with section 3ZB of the Capital Rules;
the mean-SFT adjusted leverage ratio;
the denominator, including the mean value of gross assets of SFTs, used in the calculation of the mean-SFT adjusted leverage ratio referred to in subparagraph (iv); (L.N. 168 of 2023)
an explanation of any material changes in the matters referred to in paragraph (a) during the reporting period, including key drivers of those changes; and (L.N. 168 of 2023)
an explanation of any material differences between the gross amount of SFT assets that are used in the calculation of the leverage ratio referred to in paragraph (a)(i) and the mean value of gross assets of SFTs specified under paragraph (a)(v). (L.N. 168 of 2023)
In this section—
mean-SFT adjusted leverage ratio (經調整平均證券融資交易槓桿比率) has the meaning given by section 16AB(2). (L.N. 168 of 2023)(Division 3D added L.N. 77 of 2018)
An authorized institution must disclose, for each annual reporting period, information relating to the institution’s approach to liquidity risk management that is necessary or relevant for facilitating an understanding of the soundness of its liquidity risk management framework and liquidity position.
An authorized institution that is a category 1 institution must disclose, for each quarterly reporting period—
the following as calculated based on the calculation methodology and instructions set out in the liquidity position return—
the details of its LCR;
its HQLA;
a breakdown of the total net cash outflows; and
sufficient qualitative explanation for facilitating an understanding of its LCR calculation.
An authorized institution that is a category 1 institution must disclose, for each semi-annual reporting period—
the following as calculated based on the calculation methodology and instructions set out in the stable funding position return—
the details of its NSFR;
a breakdown of its ASF and RSF; and
sufficient qualitative explanation for facilitating an understanding of its NSFR calculation.
An authorized institution must disclose, for each annual reporting period, the main characteristics and elements of its credit risk management, including—
its business model;
its credit risk profile; and
its organization and functions involved in credit risk management and risk management reporting.
An authorized institution must disclose, for each semi-annual reporting period, an overview of the credit quality of its on-balance sheet exposures and off-balance sheet exposures.
An authorized institution must disclose, for each semi-annual reporting period—
the changes in its defaulted loans and debt securities, including—
any changes in the amounts of defaulted exposures;
any movement between defaulted and non-defaulted exposures; and
any reductions in the defaulted exposures due to write-offs; and
an explanation of any material changes in the matters referred to in paragraph (a) during the semi-annual reporting period.
An authorized institution must disclose, for each annual reporting period, additional qualitative and quantitative information on the credit quality of its exposures to supplement the information disclosed under sections 16H and 16I.
An authorized institution must disclose, for each annual reporting period, qualitative information on its policies and processes relating to the use of credit risk mitigation.
An authorized institution must disclose, for each semi-annual reporting period—
the extent of credit risk exposures covered by different types of recognized credit risk mitigation; and
an explanation of any material changes in the matters referred to in paragraph (a) during the semi-annual reporting period.
An authorized institution using the STC approach to calculate its credit risk capital requirements for non-securitization exposures must disclose, for each annual reporting period, information on—
the process it adopts for using ECAI ratings; and
the extent to which the ratings are used for its risk-weighted amount calculation.
An authorized institution using the STC approach or the BSC approach to calculate its credit risk capital requirements for non-securitization exposures must disclose, for each semi-annual reporting period—
the effects of any recognized credit risk mitigation (including recognized collateral based on the comprehensive approach or the simple approach or both) on the calculation of its capital requirements under the STC approach or the BSC approach (as the case requires); and
an explanation of any material changes in the effects referred to in paragraph (a) during the semi-annual reporting period.
An authorized institution using the STC approach or the BSC approach to calculate its credit risk capital requirements for non-securitization exposures must disclose, for each semi-annual reporting period—
a breakdown of credit risk exposures by exposure classes and by risk-weights corresponding to the categorization of exposures according to the STC approach or the BSC approach (as the case requires); and (L.N. 168 of 2023)
an explanation of any material changes in the exposures referred to in paragraph (a) during the semi-annual reporting period.
An authorized institution using the IRB approach to calculate its credit risk capital requirements for non-securitization exposures must disclose, for each annual reporting period—
additional information on its internal models used to calculate the risk-weighted amount for credit risk, describing the main characteristics of the models used at the group-wide level (according to the scope of regulatory consolidation applicable to the institution); and
an explanation of how the scope of the models described is determined.
The disclosures must include the percentage of risk-weighted amounts covered by the models for each of the institution’s regulatory portfolios.
An authorized institution using the IRB approach to calculate its credit risk capital requirements for non-securitization exposures must disclose, for each semi-annual reporting period—
the main parameters of its internal models used for the calculation of capital requirements; and
an explanation of any material changes in the matters referred to in paragraph (a) during the semi-annual reporting period, including key drivers of those changes.
An authorized institution using the IRB approach to calculate its credit risk capital requirements for non-securitization exposures must disclose, for each semi-annual reporting period—
the effects of recognized credit derivative contracts on the calculation of its risk-weighted amounts under the IRB approach; and
an explanation of the effects referred to in paragraph (a).
An authorized institution using the IRB approach to calculate its credit risk capital requirements for non-securitization exposures must disclose, for each quarterly reporting period—
a flow statement explaining changes in the risk-weighted amount for credit risk determined under the IRB approach; and
an explanation of any material changes in the risk-weighted amount referred to in paragraph (a) during the quarterly reporting period.
An authorized institution using the IRB approach to calculate its credit risk capital requirements for non-securitization exposures must disclose, for each annual reporting period—
back-testing data to validate the reliability of PD calculations, including a comparison of the PD used to calculate capital requirements with the effective default rates of the obligors; and
an explanation of any material changes in the matters referred to in paragraph (a) during the annual reporting period.
An authorized institution using the IRB approach to calculate its credit risk capital requirements for non-securitization exposures must disclose, for each semi-annual reporting period—
quantitative information in respect of its specialized lending under the supervisory slotting criteria approach; and
an explanation of any material changes in the matter referred to in paragraph (a) during the semi-annual reporting period.
An authorized institution must disclose, for each annual reporting period—
a description of its counterparty credit risk management objectives and policies, including those related to—
the setting of operating limits;
the use of guarantees and other forms of credit risk mitigation;
the risk that arises when the probability of default of counterparties is positively correlated with general market risk factors; and
the specific wrong-way risk section 226A of the Capital Rules; and
the impact on the institution in terms of the amount of collateral that it would have to provide if there were a downgrade in its credit rating.
An authorized institution must disclose, for each semi-annual reporting period—
a breakdown of default risk exposures (other than those to CCPs), risk-weighted amounts and, where applicable, main parameters used, under the approaches used by the institution to calculate its default risk exposures in respect of derivative contracts and SFTs; and
an explanation of any material changes in the matters referred to in paragraph (a) during the semi-annual reporting period.
(Repealed L.N. 168 of 2023)
An authorized institution using the STC approach or the BSC approach to calculate its credit risk capital requirements for non-securitization exposures must disclose, for each semi-annual reporting period—
a breakdown of default risk exposures (other than those to CCPs) by exposure classes and by risk-weights in respect of derivative contracts and SFTs, irrespective of the approach used to determine the amount of default risk exposures; and (L.N. 168 of 2023)
an explanation of any material changes in the exposures referred to in paragraph (a) during the semi-annual reporting period.
An authorized institution using the IRB approach to calculate its credit risk capital requirements for non-securitization exposures must disclose, for each semi-annual reporting period—
all relevant parameters used for the calculation of counterparty credit risk capital requirements (other than those arising from exposures to CCPs); (L.N. 168 of 2023)
(if it uses the foundation IRB approach for certain exposures and the advanced IRB approach for other exposures) 2 separate sets of portfolio breakdown by the 2 approaches;
the key models used at the group-wide level for the calculation of counterparty credit risk exposures (other than those to CCPs) according to the scope of regulatory consolidation applicable to the institution and an explanation of how the scope of the models is determined, including the percentage of risk-weighted amounts covered by each of the models for each portfolio; and
an explanation of any material changes in the matters referred to in each of paragraphs (a), (b) and (c) during the semi-annual reporting period.
An authorized institution must disclose, for each semi-annual reporting period—
a breakdown of all types of collateral posted by the institution to support, or recognized collateral received by the institution to reduce, the counterparty credit risk exposures in respect of derivative contracts or SFTs, including contracts or transactions cleared through a CCP; and (L.N. 168 of 2023)
an explanation of any material changes in the matters referred to in paragraph (a) during the semi-annual reporting period.
An authorized institution must disclose, for each semi-annual reporting period—
the amount of its credit-related derivative contracts, broken down into credit protection bought and credit protection sold; and
an explanation of any material changes in the matters referred to in paragraph (a) during the semi-annual reporting period.
An authorized institution using the IMM(CCR) approach to calculate its default risk exposures in respect of derivative contracts or SFTs must disclose, for each quarterly reporting period—
a flow statement explaining changes in the risk-weighted amount for default risk exposures determined under the IMM(CCR) approach; and
an explanation of any material changes in the risk-weighted amount referred to in paragraph (a) during the quarterly reporting period.
An authorized institution must disclose, for each semi-annual reporting period—
a breakdown of its exposures to both qualifying and non-qualifying CCPs and the respective risk-weighted amounts, including—
default risk exposures to the CCPs; and
credit risk exposures arising from initial margins posted, and default fund contributions made, to the CCPs; and
an explanation of any material changes in the matters referred to in paragraph (a) during the semi-annual reporting period.
In this Division—
eligible securitization transaction (合資格證券化交易) has the meaning given by section 229 of the Capital Rules; non-eligible securitization transaction (非合資格證券化交易) has the meaning given by section 229 of the Capital Rules.An authorized institution must disclose, for each annual reporting period, qualitative information on its strategy and risk management with respect to its securitization activities.
An authorized institution must disclose, for each semi-annual reporting period—
a breakdown of its securitization exposures in the banking book (regardless of whether the exposures arise from an eligible securitization transaction or a non-eligible securitization transaction); and (L.N. 77 of 2018)
an explanation of any material changes in the exposures referred to in paragraph (a) during the semi-annual reporting period.
An authorized institution must disclose, for each semi-annual reporting period—
a breakdown of its securitization exposures in the trading book (regardless of whether the exposures arise from an eligible securitization transaction or a non-eligible securitization transaction); and (L.N. 77 of 2018)
an explanation of any material changes in the exposures referred to in paragraph (a) during the semi-annual reporting period.
An authorized institution must disclose, for each semi-annual reporting period—
a breakdown of—
its securitization exposures in the banking book arising from securitization transactions—
of which the institution is an originating institution; and
that are eligible securitization transactions; and (L.N. 77 of 2018)
the associated capital requirements of the exposures referred to in subparagraph (i); and
an explanation of any material changes in the matters referred to in paragraph (a) during the semi-annual reporting period.
An authorized institution must disclose, for each semi-annual reporting period—
a breakdown of—
its securitization exposures in the banking book arising from securitization transactions of which the institution is an investing institution; and
the associated capital requirements of the exposures referred to in subparagraph (i); and
an explanation of any material changes in the matters referred to in paragraph (a) during the semi-annual reporting period.
An authorized institution must disclose, for each annual reporting period, a description of its market risk management objectives and policies.
An authorized institution using the IMA to calculate part or all of its market risk capital charge must disclose, for each annual reporting period— (L.N. 168 of 2023)
the scope and the main characteristics of the different models used for calculating the market risk capital charge; and (L.N. 168 of 2023)
the key modelling choices adopted in respect of the models.
An authorized institution using the STM approach to calculate part or all of its market risk capital charge must disclose, for each semi-annual reporting period— (L.N. 168 of 2023)
the components of its market risk capital charge calculated using the STM approach; and
an explanation of any material changes in the components referred to in paragraph (a) during the semi-annual reporting period, including key drivers of those changes.
An authorized institution using the IMA to calculate part or all of its market risk capital charge must disclose, for each quarterly reporting period—
the components of its market risk capital charge calculated using the IMA;
the corresponding components referred to in paragraph (a) for the immediately preceding quarterly reporting period; and
an explanation of any material changes in the components referred to in paragraph (a) during the quarterly reporting period, including key drivers of those changes.
An authorized institution using the SSTM approach to calculate its market risk capital charge must disclose, for each semi-annual reporting period—
the components of its market risk capital charge calculated using the SSTM approach; and
an explanation of any material changes in the components referred to in paragraph (a) during the semi-annual reporting period, including key drivers of those changes.
(Repealed L.N. 168 of 2023)
(Division 7A added L.N. 168 of 2023)
An authorized institution must disclose, for each annual reporting period, a description of its CVA risk management objectives and policies.
An authorized institution using the standardized CVA approach to calculate part or all of its CVA risk capital charge must disclose, for each annual reporting period, the main characteristics of its CVA risk management framework, including—
a description of the framework;
a description of senior management’s involvement in the framework; and
an overview of the governance of the framework.
An authorized institution using the reduced basic CVA approach to calculate part or all of its CVA risk capital charge must disclose, for each semi-annual reporting period—
the components used for calculating the CVA risk capital charge under the reduced basic CVA approach; and
a description of the type of CVA hedges used by the institution, irrespective of whether the CVA hedges are eligible or not as set out in section 322U of the Capital Rules.
An authorized institution using the full basic CVA approach to calculate part or all of its CVA risk capital charge must disclose, for each semi-annual reporting period, the components used for calculating the CVA risk capital charge under the full basic CVA approach.
An authorized institution using the standardized CVA approach to calculate part or all of its CVA risk capital charge must disclose, for each semi-annual reporting period, the components used for calculating the CVA risk capital charge under the standardized CVA approach.
An authorized institution using the standardized CVA approach to calculate part or all of its CVA risk capital charge must disclose, for each quarterly reporting period—
a flow statement explaining changes in the risk-weighted amount for CVA risk determined under the standardized CVA approach; and
an explanation of any material changes in the risk-weighted amount referred to in paragraph (a) during the quarterly reporting period, including key drivers of those changes.
An authorized institution must, in respect of its interest rate exposures that arise from its banking book positions, disclose for each annual reporting period, a description of its risk management objectives and policies.
An authorized institution must disclose, for each annual reporting period, information on the impact of interest rate movements from an earnings perspective and an economic value perspective under each of the supervisory prescribed interest rate shock scenarios referred to in the standard disclosure template, in respect of its interest rate exposures that arise from—
its banking book positions; or
if the institution is exempted under section 22(1) of the Capital Rules—aggregate positions of its banking book and trading book.
In subsection (1)—
standard disclosure template (標準披露模版), in relation to an authorized institution, means a standard disclosure template or table specified under section 6(1)(ab) or 88(1)(b).(Division 8A added L.N. 168 of 2023)
An authorized institution must disclose, for each annual reporting period, the main characteristics and elements of its operational risk management framework.
This section applies to an authorized institution—
that is classified under section 331 of the Capital Rules as a bucket 2 AI or a bucket 3 AI; or
that is classified under section 331 of the Capital Rules as a bucket 1 AI and falls within section 332(2)(a) or (b) of those Rules.
The institution must disclose, for each annual reporting period—
its annual operational risk losses incurred over the last 10 years, or a fewer number of years that the institution uses to calculate its loss component under Division 5 of Part 9 of the Capital Rules, based on the accounting date of the incurred losses; and
an explanation of the rationale for any new exclusions of operational risk losses since the previous disclosure, and any other material information relating to its historical operational risk losses and loss recoveries during the annual reporting period.
An authorized institution must disclose, for each annual reporting period—
the business indicator and a breakdown of the business indicator components that are used by the institution for the operational risk capital charge calculation;
an explanation of any material changes in the matters referred to in paragraph (a) during the annual reporting period, including key drivers of those changes; and
divested businesses and activities that the institution has obtained the Monetary Authority’s approval under Part 9 of the Capital Rules to exclude from the calculation of the business indicator.
In this section—
business indicator (業務指標) has the meaning given by section 323(1) of the Capital Rules; business indicator component (業務指標組成部分) has the meaning given by section 323(1) of the Capital Rules.An authorized institution must disclose, for each annual reporting period, information for the calculation of its minimum operational risk capital requirement.
(Division 8B added L.N. 168 of 2023)
An authorized institution that uses any of the model-based approaches as defined by section 355 of the Capital Rules to calculate its credit risk or market risk, or both, for some or all of its exposures must disclose, for each quarterly reporting period—
a comparison of the actual risk-weighted amount for credit risk, market risk, CVA risk and operational risk referred to in section 357 of the Capital Rules against the risk-weighted amount for credit risk, market risk, CVA risk and operational risk calculated using only standardized approaches as set out in section 356 of the Capital Rules, as applicable, at risk level; and
subject to subsection (3), an explanation of the main drivers of the differences between the 2 risk-weighted amounts stated under paragraph (a).
(Repealed L.N. 151 of 2025)
The disclosure under subsection (1)(b) must include the extent to which an authorized institution is using the SEC-ERBA (except the use of the internal assessment approach set out in section 266A of the Capital Rules), the SEC-SA or the SEC-FBA for the calculation of risk-weighted amount for securitization exposures if the risk-weighted amount for securitization exposures in the banking book is a main driver of the differences.
An authorized institution that uses the IRB approach to calculate its credit risk for non-securitization exposures must disclose, for each semi-annual reporting period—
a comparison of the risk-weighted amount of credit risk for non-securitization exposures calculated in accordance with section 356(2)(a) of the Capital Rules at the exposure class level against the corresponding risk-weighted amount calculated under the calculation approach or approaches used by the institution for credit risk; and
an explanation of the main drivers of the differences between the 2 risk-weighted amounts stated under paragraph (a).
(Division 8C added L.N. 168 of 2023)
An authorized institution must disclose, for each semi-annual reporting period—
the carrying value amounts of assets on its financial statement distinguishing encumbered assets and unencumbered assets; and
information relevant to the carrying value amounts of assets referred to in paragraph (a), including an explanation of any material changes in those amounts during the semi-annual reporting period.
In this section—
encumbered assets (具產權負擔資產), in relation to an authorized institution, means any assets that the institution is restricted or prevented from liquidating, selling, transferring or assigning, due to legal, regulatory, contractual or other limitations; unencumbered assets (無產權負擔資產), in relation to an authorized institution, means any assets of the institution other than encumbered assets.(Division 8D added L.N. 151 of 2025)
An authorized institution with cryptoasset exposures must disclose, for each annual reporting period—
an overview of its business activities related to cryptoassets, the associated risks and risk management policies; and
the approach used in assessing the classification conditions under section 361(2) or (3) of the Capital Rules for each group 1 cryptoasset to which the institution has an exposure.
An authorized institution with cryptoasset exposures must disclose, for each semi-annual reporting period—
an overview of its cryptoasset exposures according to the classification of the cryptoassets under section 361 of the Capital Rules;
an explanation of its policies and risk mitigation used in its management of operational risk related to cryptoasset exposures;
the aggregate market value and the types of cryptoassets that the institution held in custody; and
an explanation of any material changes in the matters referred to in paragraphs (a), (b) and (c) during the semi-annual reporting period, including key drivers of those changes.
The disclosure under subsection (1)(a) must include a breakdown of the exposure amounts used to calculate the institutionʼs capital requirements or capital charge for its credit risk or market risk (as the case requires), the risk-weighted amounts and, if applicable, material exposures to individual group 1b cryptoassets, group 2a cryptoassets and group 2b cryptoassets.
An authorized institution with cryptoasset exposures must disclose, for each semi-annual reporting period—
information on the accounting classification and measurement of its cryptoasset exposures; and
an explanation of any material changes in the matters referred to in paragraph (a) during the semi-annual reporting period, including key drivers of those changes.
The disclosure under subsection (1)(a) must include a breakdown of the carrying values, based on the scope of regulatory consolidation applicable to the institution, of every relevant item of the assets and liabilities reported in the institutionʼs financial statements by the classification of the cryptoassets made under section 361 of the Capital Rules.
An authorized institution that is a category 1 institution with cryptoasset exposures must disclose, for each semi-annual reporting period—
an overview of its cryptoasset exposures, including a breakdown by the classification of, and main parameters for, cryptoasset exposures that are relevant to the calculation of its LCR and NSFR, based on the calculation methodology and instructions set out in the liquidity position return and the stable funding position return, as applicable; and
an explanation of any material changes in the matters referred to in paragraph (a) during the semi-annual reporting period, including key drivers of those changes.
(Division 9 added L.N. 77 of 2018)
In this Division—
key personnel (主要人員), in relation to an authorized institution, means any employee whose duty or activity in the course of the employment involves the assumption of material risk or the taking on of material exposures on behalf of the institution.An authorized institution must disclose, for each annual reporting period, a description of its remuneration policy and key features of its remuneration system that is sufficient for facilitating an understanding of its compensation practices.
An authorized institution must disclose, for each annual reporting period—
quantitative information on the breakdown of fixed remuneration and variable remuneration to its senior management and key personnel; and
an explanation of any material changes in the matters referred to in paragraph (a) during the reporting period, including key drivers of those changes.
An authorized institution must disclose, for each annual reporting period—
quantitative information on the breakdown of its special payments to its senior management and key personnel; and
an explanation of any material changes in the matters referred to in paragraph (a) during the reporting period, including key drivers of those changes.
An authorized institution must disclose, for each annual reporting period—
quantitative information on the breakdown of its deferred and retained remuneration to its senior management and key personnel; and
an explanation of any material changes in the matters referred to in paragraph (a) during the reporting period, including key drivers of those changes.
(Format changes—E.R. 2 of 2014)
Unless the context otherwise requires, a reference to an authorized institution in a provision of this Part—
in so far as the provision relates to a semi-annual reporting period that ends at the close of an annual reporting period, is a reference to an authorized institution to which the provision applies under section 3(1); and
in so far as the provision relates to a semi-annual reporting period that ends otherwise than at the close of an annual reporting period, is a reference to an authorized institution to which the provision applies under section 3(2).
(Repealed L.N. 77 of 2018)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
Subject to subsection (2), an authorized institution shall disclose the contractual or notional amounts of each material class of its off-balance sheet exposures.
Without prejudice to the generality of subsection (1), an authorized institution shall disclose the contractual or notional amount of its off-balance sheet exposures which are—
direct credit substitutes;
transaction-related contingencies;
trade-related contingencies;
note issuance and revolving underwriting facilities;
forward asset purchases, amounts owing on partly paid-up shares and securities, forward forward deposits placed and asset sales with recourse; or
other commitments which do not fall within any of the classes of off-balance sheet exposures specified in paragraphs (a), (b), (c), (d) and (e), broken down into—
commitments which have an original maturity of not more than one year;
commitments which have an original maturity of more than one year; and
commitments which may be cancelled at any time unconditionally by the institution or which provide for automatic cancellation due to a deterioration in the creditworthiness of the persons to whom the institution has made the commitments.
Subject to subsection (4), an authorized institution shall disclose such risk exposure information as is necessary for understanding the underlying risks of the off-balance sheet exposures incurred by the institution.
Without prejudice to the generality of subsection (3), an authorized institution shall disclose the total risk-weighted amount for credit risk of its off-balance sheet exposures, if any.
In this section—
original maturity (原訂到期期限), in relation to an off-balance sheet exposure of an authorized institution, means the period between the date on which the exposure is entered into by the institution and the earliest date on which the institution can, at its option, unconditionally cancel the exposure.(Repealed L.N. 77 of 2018)
(Repealed L.N. 77 of 2018)
(Repealed L.N. 77 of 2018)
An authorized institution shall disclose a breakdown of its international claims by major countries or geographical segments in accordance with— (L.N. 160 of 2014)
the location of the counterparties; and
the types of counterparties, broken down into banks, official sector, non-bank private sector and others. (L.N. 160 of 2014)
An authorized institution shall disclose the gross amount of loans and advances to customers by major countries or geographical segments in accordance with the location of the counterparties.
An authorized institution shall disclose the basis of the country or geographical segment classification used for the purposes of subsections (1) and (2).
An authorized institution shall disclose—
the amount of impaired loans and advances to customers and, if available, overdue loans and advances to customers, disclosed separately broken down by major countries or geographical segments; (L.N. 77 of 2018)
the amounts of specific provisions allocated in respect of the loans and advances referred to in paragraph (a); and
that portion of its collective provisions which is allocated to any country or geographical segment.
In this section—
international claim (國際債權) means the international claim as described in the return of international banking statistics required to be submitted by an authorized institution to the Monetary Authority under section 63(2) of the Ordinance; (L.N. 160 of 2014) major country or geographical segment (主要國家或地域分部)—(a)in relation to an authorized institution’s international claims, means a country or geographical segment, as the case may be, to which not less than 10% of the institution’s total international claims are attributable after taking into account any recognized risk transfer; or (L.N. 160 of 2014)(b)in relation to loans and advances to customers, means a country or geographical segment, as the case may be, to which not less than 10% of the institution’s total amount of loans and advances to customers are attributable after taking into account any recognized risk transfer; recognized risk transfer (認可風險轉移)—(a)means the risk transfer as described in the return of international banking statistics required to be submitted by an authorized institution to the Monetary Authority under section 63(2) of the Ordinance; or (L.N. 160 of 2014)(b)in relation to loans and advances to a customer of an authorized institution, means that the loans and advances are guaranteed by a person in a country which is different from that of the customer.An authorized institution shall disclose the gross amount of loans and advances to customers, broken down into—
loans and advances for use in Hong Kong—
industrial, commercial and financial—
property development;
property investment;
financial concerns;
stockbrokers;
wholesale and retail trade;
manufacturing;
transport and transport equipment;
recreational activities;
information technology; and
others; and
individuals—
loans for the purchase of flats in the Home Ownership Scheme, Private Sector Participation Scheme and Tenants Purchase Scheme or their respective successor schemes;
loans for the purchase of other residential properties;
credit card advances; and
others;
trade finance; and
loans and advances for use outside Hong Kong.
An authorized institution shall disclose the extent to which loans and advances referred to in subsection (1) are covered by collateral or other security.
Where an authorized institution’s total amount of loans and advances to a counterparty type, or to a sector which has been classified by the institution as an industry sector, constitutes not less than 10% of the institution’s total amount of loans and advances, the institution shall, in respect of that counterparty type or industry sector, as the case may be, disclose—
the amount of impaired loans and advances and, if available, overdue loans and advances, set out separately; and (L.N. 77 of 2018)
the amounts of specific provisions and collective provisions.
An authorized institution shall—
disclose the gross amount of loans and advances to customers which have been overdue for—
more than 3 months but not more than 6 months;
more than 6 months but not more than one year; and
more than one year;
disclose the percentage of its total amount of loans and advances to customers which have been overdue for—
more than 3 months but not more than 6 months;
more than 6 months but not more than one year; and
more than one year; and
ensure that the total amount of loans and advances to customers as disclosed pursuant to paragraphs (a) and (b) corresponds to the total amount of loans and advances for use in Hong Kong, trade finance, and loans and advances for use outside Hong Kong as disclosed pursuant to section 26(1).
An authorized institution shall disclose—
the gross amount of loans and advances to banks which have been overdue for—
more than 3 months but not more than 6 months;
more than 6 months but not more than one year; and
more than one year; and
the percentage of its total amount of loans and advances to banks which have been overdue for—
more than 3 months but not more than 6 months;
more than 6 months but not more than one year; and
more than one year.
An authorized institution shall disclose—
a description of any collateral held in respect of the overdue loans and advances and any other forms of credit risk mitigation and, unless impracticable, an estimate of the fair value of such collateral or such other forms of credit risk mitigation; and
the amount of specific provisions made on such overdue loans and advances.
An authorized institution shall disclose—
the amount of rescheduled loans and advances to customers, excluding those which have been overdue for more than 3 months and disclosed pursuant to subsection (1); and
the percentage of such loans and advances to its total amount of loans and advances to customers.
An authorized institution shall disclose—
the amount of rescheduled loans and advances to banks, excluding those which have been overdue for more than 3 months and disclosed pursuant to subsection (2); and
the percentage of such loans and advances to its total amount of loans and advances to banks.
An authorized institution shall disclose the amount of other assets, broken down into major classes of assets (including trade bills and debt securities), which have been overdue for—
more than 3 months but not more than 6 months;
more than 6 months but not more than one year; and
more than one year.
An authorized institution shall disclose the amount of repossessed assets held, irrespective of the accounting treatment of the related loans and advances.
An authorized institution must disclose a breakdown of its Mainland exposures to non-bank counterparties, if the exposures are material, into the specified categories.
In subsection (1)—
specified categories (指明類別), in relation to disclosures for a semi-annual reporting period, means— (a)if a period for which a return of Mainland activities is submitted by the authorized institution pursuant to section 63 of the Ordinance ends at the close of the semi-annual reporting period—the categories that the institution’s Mainland exposures to non-bank counterparties are broken down into in the return; or (b)had a period for which such a return is required to be submitted by the institution pursuant to that section 63 ended at the close of the semi-annual reporting period—the categories that the institution’s Mainland exposures to non-bank counterparties would have been required to be broken down into in the return.Subject to subsections (2) and (3), an authorized institution shall disclose its foreign currency exposures which arise from trading, non-trading and structural positions in accordance with the return relating to foreign currency positions it submitted to the Monetary Authority pursuant to section 63 of the Ordinance. (L.N. 195 of 2016)
In subsection (1), the return relating to foreign currency positions—
in relation to disclosures for a semi-annual reporting period that is an interim reporting period, refers to such a return for the interim reporting period; and
in relation to disclosures for a semi-annual reporting period that ends at the close of an annual reporting period, refers to such a return for the annual reporting period. (L.N. 195 of 2016)
Where an authorized institution’s net position (in absolute terms) in a particular foreign currency constitutes not less than 10% of the institution’s total net position in all foreign currencies, the institution shall disclose in respect of the particular currency its—
spot assets;
spot liabilities;
forward purchases;
forward sales;
net options position; and
net long (or net short) position.
For the purposes of subsection (2), an authorized institution shall calculate its net options position on the basis of—
the delta-weighted position of its options contracts; or
the institution’s internal reporting method.
An authorized institution shall disclose the basis referred to in subsection (3) on which it calculates its net options position.
Where an authorized institution’s net structural position (assets less liabilities) in a particular foreign currency constitutes (in absolute terms) not less than 10% of the institution’s total net structural position in all foreign currencies, the institution shall disclose that net structural position in that particular foreign currency.
For the purposes of this section, an authorized institution shall convert all foreign currency amounts into their equivalents in Hong Kong dollars as at the reporting date in determining whether its net position or net structural position in a foreign currency constitutes not less than 10% of its total net position or total net structural position, as the case may be, in all foreign currencies.
Unless the context otherwise requires, a reference to an authorized institution in this Part is a reference to an authorized institution to which this Part applies under section 3(2).
An authorized institution must make interim financial disclosures in compliance with the prevailing accounting standards applicable to the institution.
(Repealed L.N. 77 of 2018)
(Repealed L.N. 77 of 2018)
(Repealed L.N. 77 of 2018)
(Format changes—E.R. 2 of 2014)
Unless the context otherwise requires, a reference to an authorized institution in this Part is a reference to an authorized institution to which this Part applies under section 3(1).
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
An authorized institution must make annual financial disclosures in compliance with the prevailing accounting standards applicable to the institution.
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
An authorized institution shall disclose—
the total amount of its secured liabilities; and
the nature and carrying values of its assets used as security.
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 77 of 2018)
Subject to subsection (2), an authorized institution shall—
disclose a description of each of its major business activities which is consistent with its internal management classifications;
subject to paragraph (c), disclose a breakdown of its major business activities expressed in absolute terms or in the case of each activity as a percentage of its total business activities; and
if the breakdown referred to in paragraph (b) is expressed in absolute terms, ensure that the breakdown is consistent with the figures disclosed in the institution’s audited financial statements.
An authorized institution shall, for each major business activity—
subject to subsection (3), disclose the amount of operating assets of the major business activity; and
disclose particulars of the major business activity in relation to—
total operating income (net of interest expense);
profit or loss before impairment losses and specific provisions and collective provisions for impaired assets;
profit or loss after impairment losses and specific provisions and collective provisions for impaired assets;
profit or loss before taxation; or
any combination of any of the matters referred to in subparagraphs (i), (ii), (iii) and (iv).
For the purposes of subsection (2)(a), the operating assets of a major business activity of an authorized institution are those assets—
which are employed in the course of the operating activities of the major business activity; and
which are directly attributable to the major business activity or which can be reasonably allocated to that activity.
Where not less than 10% of an authorized institution’s—
total operating income (net of interest expense);
profit or loss before taxation;
total assets;
total liabilities; or
contingent liabilities and commitments,
is booked in a single country or geographical segment, the institution shall disclose, for the item specified in each of paragraphs (a), (b), (c), (d) and (e), the absolute amount in respect of the country or geographical segment, as the case requires.
For the purposes of subsections (1), (2), (3) and (4), an authorized institution shall ensure that the figures used in determining the breakdown and disclosure of the major business activities referred to in those subsections (including the item specified in each of paragraphs (a), (b), (c), (d) and (e) of subsection (4)) are consistent with the figures disclosed in the institution’s audited financial statements.
Where the fees and commission income from a product line of an authorized institution constitutes not less than 10% of the total amount of fees and commission income of the institution, the institution shall separately disclose the fees and commission income attributable to that product line.
(Repealed L.N. 195 of 2016)
In this section—
major business activity (主要業務活動), in relation to an authorized institution, means the business activity constitutes not less than 10% of the total amount of the institution’s— (a)total operating income (net of interest expense); (b)profit or loss before impairment losses and specific provisions and collective provisions for impaired assets; (c)profit or loss after impairment losses and specific provisions and collective provisions for impaired assets; or (d)profit or loss before taxation. (L.N. 195 of 2016)Subsection (2) applies if an authorized institution’s total amount of loans and advances to a counterparty type, or to a sector that has been classified by the institution as an industry sector, constitutes not less than 10% of the institution’s total amount of loans and advances.
The institution must, in respect of that counterparty type or industry sector (as the case requires), disclose the amount of new provisions charged to profit and loss, and the amount of impaired loans and advances written off during the annual reporting period.
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 77 of 2018)
(Repealed L.N. 77 of 2018)
(Repealed L.N. 77 of 2018)
(Repealed L.N. 168 of 2023)
(Repealed L.N. 77 of 2018)
An authorized institution shall disclose—
the roles, functions and composition of any key committees established by its board of directors including any executive committee, credit committee, asset and liability committee or audit committee;
the extent of its compliance with the guideline in the Supervisory Policy Manual module CG—1 issued by the Monetary Authority and entitled “Corporate Governance of Locally Incorporated Authorized Institutions”; and (L.N. 77 of 2018)
(Repealed L.N. 77 of 2018)
particulars of, and the reasons for, any failure by it to comply with the guideline mentioned in paragraph (b). (L.N. 77 of 2018)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Repealed L.N. 195 of 2016)
(Format changes—E.R. 3 of 2015)
Unless the context otherwise requires, a reference to an authorized institution in this Part is a reference to an authorized institution to which this Part applies under section 3(6). (L.N. 195 of 2016)
A disclosure required to be made under Division 3 by an authorized institution is a disclosure only in respect of—
the institution’s local branches; and
the institution’s principal place of business in Hong Kong.
Subject to subsection (2) and section 103(1), if an authorized institution is required under this Part to disclose information (however described), it shall make that disclosure by— (L.N. 77 of 2018)
preparing a disclosure statement, in the Chinese and English languages, which contains the information;
presenting the information required to be disclosed in the format, and using the standard disclosure templates or tables (if applicable), specified by the Monetary Authority; (L.N. 77 of 2018)
publishing the statement within the following period after the end of the reporting period to which the statement relates—
if the statement relates to a quarterly reporting period that ends otherwise than at the close of an interim or annual reporting period—8 weeks;
if the statement relates to a reporting period that is, or ends at the close of, an interim reporting period—3 months;
if the statement relates to a reporting period that is, or ends at the close of, an annual reporting period—4 months; and (L.N. 77 of 2018)
complying with the other provisions of this section applicable to or in relation to the statement.
An authorized institution shall ensure that when its disclosure statement is published—
the statement contains—
all the disclosures required under this Part to be made by the institution for the reporting period to which the statement relates; or
a prescribed summary; and
neither the disclosures referred to in paragraph (a)(i), nor the prescribed summary referred to in paragraph (a)(ii), nor any information published with the prescribed summary, is false or misleading in any material respect.
(Repealed L.N. 77 of 2018)
An authorized institution shall lodge a copy of its disclosure statement with the Monetary Authority before it publishes the statement.
The Monetary Authority shall keep each copy of a disclosure statement lodged with it pursuant to subsection (4) with the register.
Subject to subsections (7) and (8), an authorized institution shall—
keep at least one copy of each of its disclosure statements (relevant copy) in its principal place of business in Hong Kong; and (L.N. 77 of 2018)
make a relevant copy available for inspection by the general public during the business hours of the institution at its principal place of business in Hong Kong. (L.N. 77 of 2018)
If an authorized institution publishes a disclosure statement that contains the disclosures referred to in subsection (2)(a)(i), it must ensure that the statement is available for inspection under subsection (6) for at least 12 months beginning on the date of publication of the statement. (L.N. 77 of 2018)
Subject to section 103(2), if an authorized institution publishes a disclosure statement which contains a prescribed summary— (L.N. 160 of 2014)
it must ensure that the statement is available for inspection under subsection (6) for at least 12 months beginning on the date of publication of the statement; and (L.N. 77 of 2018)
it shall not change the means as stated in the prescribed summary by which the general public may readily access the relevant complete disclosures unless it amends the summary in such a manner, and at such time, that the summary at all times states the means by which the general public may readily access the relevant complete disclosures.
Subsections (4) and (5) apply to an amendment referred to in subsection (8)(b) of a prescribed summary contained in an authorized institution’s disclosure statement as they apply to the disclosure statement.
Subject to section 103(2), an authorized institution—
must establish and maintain an archive of all disclosure statements published by it; and
unless otherwise approved by the Monetary Authority—must establish and maintain the archive on the institution’s internet website. (L.N. 77 of 2018)
In this section—
prescribed summary (訂明撮要), in relation to an authorized institution’s disclosure statement, means a statement setting out the location at which and the means by which the general public may readily access all the disclosures— (a)which are required under this Part to be made by the institution for the reporting period to which the disclosure statement relates; and (b)which are readily accessible by the general public (whether on an internet website or by any other means or combination of means). (L.N. 77 of 2018)The chief executive of an authorized institution shall ensure that a disclosure made by the institution pursuant to this Part contains all the material information.
In this section—
material information (重要資料) means information—(a)which is required to be disclosed under this Part; and(b)which, if it were not disclosed or were misstated, could change or influence the assessment or decision of a person relying on the disclosure concerned for the purposes of making investment or other economic decisions.Subject to subsections (2) and (3), an authorized institution which makes a quantitative disclosure pursuant to this Part shall—
for disclosures under Division 3, except for the profit and loss information disclosure under section 93 and the liquidity information disclosures under section 103, also disclose the corresponding amounts for the immediately preceding reporting period; (L.N. 160 of 2014)
for the profit and loss information disclosure under section 93 and the liquidity information disclosures under section 103—
if a disclosure statement relates to an annual reporting period—also disclose the figures for the institution’s immediately preceding annual reporting period;
if a disclosure statement relates to a quarterly reporting period—also disclose the figures for the institution’s immediately preceding quarterly reporting period; and
if a disclosure statement relates to an interim reporting period—also disclose the figures for the institution’s immediately preceding interim reporting period; (L.N. 77 of 2018)
for disclosures under Division 4, except for the pre-tax profit disclosure under section 106(1)(e), also disclose the corresponding amounts for the immediately preceding reporting period; and
for the pre-tax profit disclosure under section 106(1)(e), where a disclosure statement relates to the annual reporting period, also disclose the figures for the institution’s immediately preceding annual reporting period and, where a disclosure statement relates to the interim reporting period, also disclose the figures for the institution’s immediately preceding interim reporting period.
Where an authorized institution is unable to comply with subsection (1)(a), (b), (c) or (d) because interim consolidated information is not provided by the institution as a whole, the institution shall disclose the annual figures as comparatives.
Where an authorized institution makes disclosures pursuant to this Part for the first time and it is not practicable for the institution to provide the comparative figures required by subsection (1)(a), (b), (c) or (d) (including that subsection as read with subsection (2)), the institution is not required to comply with that subsection for the first reporting period concerned.
Subject to sections 103A, 103AB, 103AC, 103B and 103C, an authorized institution must make disclosures pursuant to this Part— (L.N. 77 of 2018; L.N. 151 of 2025)
in respect of the institution’s last financial year; and
in respect of the 6 months period immediately after the close of the institution’s last financial year.
An authorized institution shall, in addition to the disclosures it is required to make pursuant to any other provisions of this Part, include in its disclosure statement such other information that it is necessary to so include to ensure that—
the information contained in the statement is not false or misleading in any material respect; and
the operations of the institution are clearly explained.
Notwithstanding any other provisions of this Part (except section 90(3)), where it is not practicable for an authorized institution to make a disclosure required under this Part, the institution— (L.N. 268 of 2006)
shall, after consultation with the Monetary Authority, include in its disclosure statement—
a statement that it is so unable and of the reasons why it is so unable; and
information which is the closest available alternative to the information which would have been the subject of those disclosures if the institution had not been so unable; and
shall not publish the disclosure statement except with the prior consent of the Monetary Authority.
In this Division—
active market (活躍市場), in relation to any financial assets, means a market at which the quoted price of the assets— (a)is readily obtainable and regularly available from an exchange, dealer, broker, industry group, pricing service or regulatory agency; and (b)reflects actual and regularly occurring transactions involving the assets, which take place on an arm’s length basis; cash and balances with banks (現金及銀行結餘) means— (a)cash in the till; (b)demand deposits with banks; and (c)deposits with banks which have a residual contractual maturity of not more than one month; deposits and balances from banks (尚欠銀行存款及結餘), in relation to an authorized institution— (a)means all amounts which arise out of banking transactions owed by the institution to other banks; but (b)does not include such amounts taking the form of debt securities or certificates of deposit issued by the institution; investment property (投資物業) in relation to an authorized institution, means any immovable property— (a)which is owned by the institution, or held by the institution as a lessee under a finance lease, to earn rentals or for capital appreciation, or both; and (b)which is not held by the institution—(i)for use in the production or supply of goods or services or for administrative purposes; or(ii)for sale in the ordinary course of business; loans and receivables (貸款及應收款項), in relation to an authorized institution— (a)means financial assets of the institution (other than derivative contracts) with fixed or determinable payments which are not quoted in an active market; but (b)does not include—(i)financial assets which the institution—(A)intends to sell immediately or in the near term; or(B)designates upon initial recognition as at fair value through profit or loss;(ii)financial assets which the institution designates upon initial recognition as available for sale; or(iii)financial assets purchased by the institution, for which the institution may not recover substantially all of its initial investment for reasons not related to credit deterioration.Subject to subsection (2), an authorized institution shall disclose its profit and loss information on—
interest income;
interest expense;
other operating income, broken down into—
gains less losses arising from trading in foreign currencies;
gains less losses on securities held for trading purposes;
gains less losses from other trading activities;
net fees and commission income (including separate disclosure of gross fees and commission income and expenses); and
others;
operating expenses (broken down if material);
impairment losses and provisions for impaired loans and receivables;
gains less losses from the disposal of property, plant and equipment and investment properties;
profit before taxation;
tax expense or tax income; and
profit after taxation.
Where a disclosure under subsection (1) by an authorized institution does not give a full picture of the underlying performance of the institution’s business in Hong Kong, the institution shall disclose such further explanation as is necessary for understanding the performance of that business.
An authorized institution shall disclose the carrying amounts of—
each of the institution’s assets, broken down into—
cash and balances with banks (except those included in amount due from overseas offices of the institution);
placements with banks which have a residual contractual maturity of more than one month but not more than 12 months (except those included in amount due from overseas offices of the institution);
amount due from overseas offices of the institution;
trade bills;
certificates of deposit held;
securities held for trading purposes;
loans and receivables (other than those falling within subparagraph (i), (ii) or (iii)), broken down into—
loans and advances to customers;
loans and advances to banks;
other accounts (broken down if material); and
provisions for impaired loans and receivables (broken down into those against loans and advances to customers, loans and advances to banks, other accounts if material) which constitute the institution’s—
collective provisions; and
specific provisions;
investment securities;
other investments;
property, plant and equipment and investment properties; and
total assets; and
each of the institution’s liabilities, broken down into—
deposits and balances from banks (except those included in amount due to overseas offices of the institution);
deposits from customers, broken down into—
demand deposits and current accounts;
savings deposits; and
time, call and notice deposits;
amount due to overseas offices of the institution;
certificates of deposit issued;
issued debt securities;
other liabilities;
provisions; and
total liabilities.
Where provisions for loans and advances or other exposures have been set aside for an authorized institution’s local branches (including the institution’s principal place of business in Hong Kong) and are maintained at the overseas head office of the institution, the institution shall disclose the provisioning policy of the head office including the amount of specific provisions allocated for exposures maintained in the local branches of the institution (including the institution’s principal place of business in Hong Kong).
An authorized institution shall disclose—
the amount of impaired loans and advances to customers;
the amount of specific provisions made for such loans and advances;
the value of collateral which has been taken into account in respect of such loans and advances to which the specific provisions relate; and
the percentage of such loans and advances to its total amount of loans and advances to customers.
An authorized institution shall disclose—
the amount of impaired loans and advances to banks;
the amount of specific provisions made for such loans and advances;
the value of collateral which has been taken into account in respect of such loans and advances to which the specific provisions relate; and
the percentage of such loans and advances to its total amount of loans and advances to banks.
An authorized institution shall disclose the total contractual or notional amounts of derivative transactions, broken down into—
exchange rate-related derivative contracts; (L.N. 195 of 2016)
interest rate derivative contracts; and
others.
An authorized institution shall disclose such risk exposure information as is necessary for understanding the underlying risks of the exposures incurred by the institution through the institution’s use of derivative transactions.
Without prejudice to the generality of subsection (2), an authorized institution shall disclose—
the total fair value (after taking into account the effect of a valid bilateral netting agreement) of its exchange rate-related derivative contracts, interest rate derivative contracts and other derivative transactions, if any; and
the amount of fair value which has taken into account the effect of a valid bilateral netting agreement.
In this section—
exchange rate-related derivative contract (匯率關聯衍生工具合約) has the meaning given by section 281 of the Capital Rules; interest rate derivative contract (利率衍生工具合約) has the meaning given by section 281 of the Capital Rules; (L.N. 195 of 2016)An authorized institution shall disclose the contractual or notional amounts of each material class of its off-balance sheet exposures (broken down if material) including—
direct credit substitutes;
transaction-related contingencies;
trade-related contingencies;
note issuance and revolving underwriting facilities;
other commitments; and
others (including forward asset purchases, amounts owing on partly paid-up shares and securities, forward forward deposits placed, asset sales with recourse or other transactions with recourse).
An authorized institution shall disclose such risk exposure information as is necessary for understanding the underlying risks of the off-balance sheet exposures incurred by the institution.
An authorized institution shall disclose a breakdown of its international claims by major countries or geographical segments in accordance with— (L.N. 160 of 2014)
the location of the counterparties; and
the types of counterparties, broken down into banks, official sector, non-bank private sector and others. (L.N. 160 of 2014)
An authorized institution shall—
disclose the gross amount of loans and advances to customers by major countries or geographical segments in accordance with the location of the counterparties; and
disclose a breakdown of—
overdue loans and advances to customers, broken down by major countries or geographical segments; and
impaired loans and advances to customers, broken down by major countries or geographical segments. (L.N. 77 of 2018)
An authorized institution shall disclose the basis of the country or geographical segment classification used for the purposes of subsections (1) and (2).
In this section—
international claim (國際債權) means the international claim as described in the return of international banking statistics required to be submitted by an authorized institution to the Monetary Authority under section 63(2) of the Ordinance; (L.N. 160 of 2014) major country or geographical segment (主要國家或地域分部)—(a)in relation to an authorized institution’s international claims, means a country or geographical segment, as the case may be, to which not less than 10% of the institution’s total international claims are attributable after taking into account any recognized risk transfer; or (L.N. 160 of 2014)(b)in relation to loans and advances to customers, means a country or geographical segment, as the case may be, to which not less than 10% of the institution’s total amount of loans and advances to customers are attributable after taking into account any recognized risk transfer; recognized risk transfer (認可風險轉移)—(a)means the risk transfer as described in the return of international banking statistics required to be submitted by an authorized institution to the Monetary Authority under section 63(2) of the Ordinance; or (L.N. 160 of 2014)(b)in relation to loans and advances of a customer of an authorized institution, means that the loans and advances are guaranteed by a person in a country which is different from that of the customer.An authorized institution shall disclose the gross amount of loans and advances to customers, broken down into—
loans and advances for use in Hong Kong—
industrial, commercial and financial—
property development;
property investment;
financial concerns;
stockbrokers;
wholesale and retail trade;
manufacturing;
transport and transport equipment;
recreational activities;
information technology; and
others; and
individuals—
loans for the purchase of flats in the Home Ownership Scheme, Private Sector Participation Scheme and Tenants Purchase Scheme or their respective successor schemes;
loans for the purchase of other residential properties;
credit card advances; and
others;
trade finance; and
loans and advances for use outside Hong Kong.
An authorized institution shall disclose the extent to which loans and advances referred to in subsection (1) are covered by collateral or other security.
An authorized institution shall—
disclose the gross amount of loans and advances to customers which have been overdue for—
more than 3 months but not more than 6 months;
more than 6 months but not more than one year; and
more than one year;
disclose the percentage of its total amount of loans and advances to customers which have been overdue for—
more than 3 months but not more than 6 months;
more than 6 months but not more than one year; and
more than one year; and
ensure that the total amount of loans and advances to customers as disclosed pursuant to paragraphs (a) and (b) corresponds to the total amount of loans and advances for use in Hong Kong, trade finance, and loans and advances for use outside Hong Kong, as disclosed pursuant to section 99(1).
An authorized institution shall disclose—
the gross amount of loans and advances to banks which have been overdue for—
more than 3 months but not more than 6 months;
more than 6 months but not more than one year; and
more than one year; and
the percentage of its total amount of loans and advances to banks which have been overdue for—
more than 3 months but not more than 6 months;
more than 6 months but not more than one year; and
more than one year.
An authorized institution shall disclose—
a description of any collateral held in respect of the overdue loans and advances and any other forms of credit risk mitigation and, unless impracticable, an estimate of the fair value of such collateral or such other forms of credit risk mitigation; and
the amount of specific provisions made on such overdue loans and advances.
An authorized institution shall disclose—
the amount of rescheduled loans and advances to customers, excluding those which have been overdue for more than 3 months and disclosed pursuant to subsection (1); and
the percentage of such loans and advances to its total amount of loans and advances to customers.
An authorized institution shall disclose—
the amount of rescheduled loans and advances to banks, excluding those which have been overdue for more than 3 months and disclosed pursuant to subsection (2); and
the percentage of such loans and advances to its total amount of loans and advances to banks.
An authorized institution shall disclose the amount of other assets, broken down into major classes of assets (including trade bills and debt securities), which have been overdue for—
more than 3 months but not more than 6 months;
more than 6 months but not more than one year; and
more than one year.
An authorized institution shall disclose the amount of repossessed assets held as at the reporting date, and the accounting treatment of the related loans and advances.
An authorized institution must disclose a breakdown of its Mainland exposures to non-bank counterparties, if the exposures are material, into the specified categories.
In subsection (1)—
specified categories (指明類別), in relation to disclosures for a reporting period, means— (a)if a period for which a return of Mainland activities is submitted by the authorized institution pursuant to section 63 of the Ordinance ends at the close of the reporting period—the categories that the institution’s Mainland exposures to non-bank counterparties are broken down into in the return; or (b)had a period for which such a return is required to be submitted by the institution pursuant to that section 63 ended at the close of the reporting period—the categories that the institution’s Mainland exposures to non-bank counterparties would have been required to be broken down into in the return.Subject to subsections (2) and (3), an authorized institution shall disclose its foreign currency exposures which arise from trading, non-trading and structural positions in accordance with the returns relating to foreign currency positions it submitted to the Monetary Authority pursuant to section 63 of the Ordinance in respect of the reporting period.
Where an authorized institution’s net position (in absolute terms) in a particular foreign currency constitutes not less than 10% of the institution’s total net position in all foreign currencies, the institution shall disclose in respect of the particular currency its—
spot assets;
spot liabilities;
forward purchases;
forward sales;
net options position; and
net long (or net short) position.
For the purposes of subsection (2), an authorized institution shall calculate its net options position on the basis of—
the delta-weighted position of its options contracts; or
the institution’s internal reporting method.
An authorized institution shall disclose the basis referred to in subsection (3) on which it calculates its net options position.
Where an authorized institution’s net structural position (assets less liabilities) in a particular foreign currency constitutes (in absolute terms) not less than 10% of the institution’s total net structural position in all foreign currencies, the institution shall disclose that net structural position in that particular foreign currency.
For the purposes of this section, an authorized institution shall convert all foreign currency amounts into their equivalents in Hong Kong dollars as at the reporting date in determining whether its net position or net structural position in a foreign currency constitutes not less than 10% of its total net position or total net structural position, as the case may be, in all foreign currencies.
An authorized institution must do either of the following—
include in the financial statements or the disclosure statement relating to the reporting period published by it the disclosures under, as applicable—
sections 103A, 103AB and 103AC; or
sections 103B and 103C; (L.N. 77 of 2018)
provide in the financial statements or the disclosure statement relating to the reporting period a direct link to the relevant sections of its internet website where the disclosures referred to in paragraph (a) can be found. (L.N. 77 of 2018)
An authorized institution must establish and maintain an archive of all disclosures relating to the reporting periods ending after 31 December 2014 and made by it under the provisions referred to in subsection (1)(a).
An authorized institution must make the following disclosures on a Hong Kong office basis—
for a category 1 institution—disclosures under sections 103A, 103AB and 103AC of the average value of its LCR and quarter-end value of its NSFR and the related information;
for a category 2 institution that is designated as a category 2A institution—disclosures under sections 103B and 103C of the average values of its LMR and CFR and the related information;
for a category 2 institution that is not designated as a category 2A institution—disclosures under section 103B of the average value of its LMR and the related information. (L.N. 77 of 2018)
Disclosures under this section and sections 103A, 103AB, 103AC, 103B and 103C may be presented in Hong Kong dollars or the equivalent amount in Hong Kong dollars. (L.N. 77 of 2018)
An authorized institution must disclose, for each annual reporting period, information relating to the institution’s approach to liquidity risk management that is necessary or relevant for facilitating an understanding of the soundness of its liquidity risk management framework and liquidity position. (L.N. 77 of 2018)
The disclosure under subsection (4A) must, for an authorized institution with cryptoasset exposures, include—
an overview of the institutionʼs business activities related to cryptoassets that give rise to liquidity risks and the associated risk management policies for those risks; and
in the case of a category 1 institution, the approach used in assessing the classification conditions under section 361(2) or (3) of the Capital Rules for each group 1 cryptoasset to which the institution has an exposure. (L.N. 151 of 2025)
(Repealed L.N. 77 of 2018)
An authorized institution that is a category 1 institution must disclose, for each quarterly reporting period—
the following as calculated based on the calculation methodology and instructions set out in the liquidity position return—
the details of its LCR;
its HQLA;
a breakdown of the total net cash outflows; and
sufficient qualitative explanation for facilitating an understanding of its LCR calculation.
An authorized institution that is a category 1 institution must disclose—
for each quarterly reporting period—the quarter-end value of its NSFR including the numerator and the denominator for computing the ratio; and
for each semi-annual reporting period—
the following as calculated based on the calculation methodology and instructions set out in the stable funding position return—
the details of its NSFR;
a breakdown of its ASF and RSF; and
sufficient qualitative explanation for facilitating an understanding of its NSFR calculation.
An authorized institution that is a category 1 institution with cryptoasset exposures must disclose, for each semi-annual reporting period—
an overview of its cryptoasset exposures, including a breakdown by the classification of, and main parameters for, cryptoasset exposures that are relevant to the calculation of its LCR and NSFR, based on the calculation methodology and instructions set out in the liquidity position return and the stable funding position return, as applicable; and
an explanation of any material changes in the matters referred to in paragraph (a) during the semi-annual reporting period, including key drivers of those changes.
An authorized institution that is a category 2 institution must disclose, for each quarterly reporting period, the average value of its LMR.
For the purposes of subsection (1), the authorized institution must calculate the average value of its LMR for the reporting period, based on the arithmetic mean of the average value of its LMR for each calendar month as reported in the liquidity position return submitted for the reporting period.
(Repealed L.N. 77 of 2018)
An authorized institution that is a category 2A institution must disclose, for each quarterly reporting period, the average value of its CFR.
For the purposes of subsection (1), the authorized institution must calculate the average value of its CFR for the reporting period, based on the arithmetic mean of the average value of its CFR for each calendar month as reported in the liquidity position return submitted for the reporting period.
For the purposes of this Division, an authorized institution shall—
make consolidated group level disclosures based on the most recent consolidated accounts of the institution as at the publication date of the disclosure statement (being the most recent annual accounts or interim accounts, as the case requires, of the institution);
if the institution has a holding company and does not itself publish consolidated accounts—
ensure that the information it is required to disclose under this Division is extracted from the corresponding information in the consolidated accounts of the group of companies of which the institution is a member; and
disclose the extracted information; and
if it does not publish interim accounts or only publishes unconsolidated information in its interim accounts, disclose the corresponding consolidated information from its most recent annual accounts.
An authorized institution shall—
subject to paragraph (b), disclose its consolidated capital adequacy ratio calculated in accordance with—
the prevailing banking supervisory standards relating to capital adequacy issued by the Basel Committee and adopted by the relevant banking supervisory authority; or (L.N. 52 of 2013; L.N. 151 of 2025)
any other standards that are substantially similar to those described in subparagraph (i), (L.N. 52 of 2013)
as at the date of its most recently available annual accounts or interim accounts;
if its consolidated capital adequacy ratio is not calculated in accordance with the standards referred to in paragraph (a), disclose that fact with its consolidated capital adequacy ratio; and (L.N. 52 of 2013)
disclose the total amount of shareholders’ funds (being capital and reserves).
Subject to subsection (2), an authorized institution shall disclose the following consolidated information as at the date of its most recently available annual or interim accounts—
total assets;
total liabilities;
total loans and advances;
total customer deposits (or total deposits); and
pre-tax profit.
Where an authorized institution’s total customer deposits referred to in subsection (1)(d) are not separately disclosed in its annual or interim accounts, the institution shall disclose—
the amount of its total deposits (including those from banks); and
the fact that the disclosure referred to in paragraph (a) is made pursuant to this subsection.