THE Governor has been criticised by leading banker and legislator
David Li Kwok-po for failing to democratise Hong Kong's banking
sector and rid the territory of what he called the " last vestiges
of colonialism" in the financial system.
Chris Patten had concentrated on political reform but failed
to tackle financial reform and so level the playing field for
local banks trying to compete against the monolith of the Hongkong
Bank, said Mr Li, chief executive of the Bank of East Asia.
However, Mr Li said the Governor was probably unaware of the
need for reform because he had little personal understanding
of the issues and relied on his advisers, most of whom have
a vested interest in maintaining the old system.
" Most of his advisers are basically the people who want to
perpetuate this colonial system. Just look at who is on the
Executive Council. There are not too many independent voices,"
Mr Li said in an interview with the South China Morning Post.
He claimed Mr Patten's advisers disguised their vested interests
by saying it was necessary to preserve the system in order to
maintain stability and prosperity and not rock the boat.
" But it is not a question of not rocking the boat," Mr Li said,
" it is a question of preserving their own profitability.
"What Chris Patten needs to do is to drum into these people
that they are no longer a colonial power."
Mr Li, a director of South China Morning Post (Holdings) Ltd.
was particularly critical of the Hong Kong Monetary Authority
(HKMA), a body he singled out for perpetuating the existing
system and failing to support local institutions.
The HKMA currently refuses to place funds with local banks because
they are not rated by Moody's Investors Services or Standard
& Poor's. Only note issuing banks are currently rated.
Mr Li said the HKMA had more than enough information to rate
local banks itself and should not rely on outside agencies,
which are not as well informed, to determine who was and who
was not eligible for funds.
" I thought that all monetary authorities would support their
own institutions. Instead the HKMA is placing funds outside
Hong Kong with overseas institutions. I'm not against that but
I do think a certain amount of Hong Kong money should be placed
with local banks," he said.
The HKMA's deputy chief executive, Andrew Sheng, defended the
body's insistence on using international agencies In rating
banks, saying Hong Kong was an international financial centre
and as such the HKMA was required to use " objective international
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