Having said that, you may rest assured that the HKMA is committed to continue its collaboration with the SFC and the industry to make sure that our regulatory framework and rules remain friendly to users without compromising investor protection as we go forward in the months and years ahead. The third and final question is: are private banks fully equipped and ready to capture the rapidly growing business opportunities? The answer to this, I would say, is again “yes” followed by a “but”. This is because much more needs to be done by the industry if it wishes to realise Hong Kong’s full potential in the medium and long term. As I said earlier, the adoption of a portfolio approach in private banking would be a move welcomed by private banks and their customers, but private banks must ensure they have the proper systems and controls in place. A portfolio based approach cannot be taken as an excuse to compromise investor protection. For instance, when more Mainland clients open private banking accounts in Hong Kong, our banks must have in place sufficient number of account managers who are professionally competent and linguistically proficient. It is hard to imagine that quality service can be provided to a Mainland customer who does not speak English or Cantonese if the account manager cannot communicate in Putonghua. Moreover, it would also be helpful if important contracts or documents are written in bilingual forms so that Mainland customers find it easier to understand what they have signed or bought.
I have chosen this topic because over the past few months, the Hong Kong Monetary Authority (HKMA), together with the Securities and Futures Commission (SFC) and the Financial Services and the Treasury Bureau, has been working very closely with the Hong Kong Association of Banks (HKAB) on what Hong Kong should do to take the private banking industry to the next higher platform. I would like to take this opportunity to share with you my views on the steps Hong Kong needs to take to develop as the premier private banking hub in Asia. To start with, I want to talk about some facts relevant to Hong Kong’s realisation of this aspiration. Hong Kong’s strengths to be a leading private banking centre Wealth in Asia-Pacific is growing exponentially. According to industry research, the region accounted for half of the growth in global wealth from 2010 onwards. In particular, China was the second top contributor to the growth in global wealth after the US.1 In 2011, there were about 30 million millionaires worldwide. Among these, about 20% were from Asia-Pacific.1 This trend is likely to continue. It is estimated that global wealth will rise 50% further by 2016.1 This is hardly surprising in that the International Monetary Fund forecasts that, emerging Asia, led by China, will contribute almost 60% of the world’s GDP growth by 2016.