Arthur Yuen: Bank account opening and maintenance
Opening remarks by Mr Arthur Yuen, Deputy Chief Executive of the Hong Kong Monetary
Authority, at the Briefing cum networking session on "Bank Account Opening and Maintenance",
Hong Kong, 21 April 2017.
* * *
Good afternoon, ladies and gentlemen,
1. A very warm welcome to all of you to this briefing and networking session. We are going to
discuss the important issue of business account opening and maintenance, and this event
is jointly organised by the HKMA and Invest Hong Kong. I would like to first of all welcome all
the representatives of Chambers of Commerce, who share the same concern as the HKMA
that some SMEs and start-up companies from overseas are finding it difficult to open bank
accounts in Hong Kong.
2. I am sure you would all appreciate that over the past years, customer due diligence (CDD)
requirements have tightened globally, and Hong Kong followed this international trend.
Needless to mention is also that a very small number of banks, for a variety of reasons,
need to comply with requirements or standards mandated by their head offices or overseas
authorities, thus leading to de-risking efforts in some instances. Surely no one would
disagree that we are now in a more complex world, and sometimes we indeed have to deal
with sub-optimal outcome. But I totally appreciate that knowing it is one thing, and
experiencing the effect of it is quite another.
3. To address this concern of the business community, the HKMA has been working very hard
with banks and various stakeholders in tackling the issue. Our aim is to maintain a robust
AML regime in Hong Kong while the system does not undermine access by legitimate
businesses and ordinary citizens to basic banking services. So we require banks to apply a
risk-based approach to the CDD process, and also emphasize the importance of banks'
engagement with customers to ensure that they are treated fairly. Since our sharing
session last summer and the further guidance we provided to banks last September, it is
now time to take stock of the latest developments. I will leave it to the banks to talk more
about the improvement measures that they have pursued or are pursuing. They would also
discuss the various practical aspects relating to account opening and account maintenance
at the panel discussion later on.
4. While full efforts are being made to improve the situation, there is also feedback that some
foreign companies are under the perception that Hong Kong is not a welcoming place for
business, and have therefore turned to banks in other jurisdictions to open accounts. This is
very bad for Hong Kong's reputation. For those of us who know what is being done, Hong
Kong is clearly and definitely not closed for business. One of the important points now is
therefore : how can we turn around such a negative perception.
5. Last month, the HKMA launched a dedicated webpage on our website to provide more
comprehensive information related to bank account opening and maintenance. At the same
time, we have set up a to facilitate the public and business
dedicated email account
community to provide feedback directly to the HKMA. The HKMA webpage contains
information about account opening and maintenance procedures, documentation and
information requirements for opening banking accounts, and contact details of banks.
Furthermore, our webpage also provides information on what banks should not do, and
useful tips for reference of customers whose account opening applications have been
rejected. There is also a "What's New" section to provide an update of banks' recent
initiatives regarding account opening and maintenance. The feedback we received through
the email account is handled by a dedicated team at the HKMA.
6. Some of you might have already browsed through our dedicated webpage and noted that
some banks have acted on your comments that a dedicated hotline would help improve
customer experience. Indeed, some unpleasant experience might have been caused by
mis-communication or even just a language issue, and a dedicated hotline resourced with
properly trained front-line staff would be helpful.
7. In our outreach to Chambers in recent months, we have also received comments that it is
not user-friendly for business persons overseas to make several trips to Hong Kong for
opening a bank account. We fully agree with that. And I would like to share with you that
some banks have launched what we may call a "pre-vetting" process for account
opening. This means an applicant may request to first submit the documentation and
information required for opening an account to the bank by mail, fax or email, and the bank
will "pre-screen" or "pre-vet" them before arranging the applicant to have a face-to-face
meeting in Hong Kong. I trust this change in process flow would be welcome by customers
based overseas.
8. We are also working closely with the industry to explore the use of technology to enhance
the efficiency of account opening processes, such as KYC Utilities ("KYCU") and
technology to allow remote account opening. You may have heard about KYCU, which are
third-party platforms that aim to manage data as a strategic asset across banks to reduce
duplication and cost and assist banks in making decisions, on all types of risks, including but
not limited to AML, and as a result to make smarter business decisions. For example, a
single source of customer data or documents would remove the need of a customer to
provide KYC documentation to every bank, and may shorten the turnaround time for new
account opening. We have had a number of discussions with major banks and relevant
technology providers and steps have already been taken by both the HKMA and some major
banks to take this work forward. At the same time, we understand that several banks are
looking at the use of technology to allow remote account application by the use of video
conferencing. We are working closely with those banks and the industry association and we
believe this is another promising development on the horizon.
9. Admittedly a lot of related work is still in progress, but we hope that you would begin to feel
that The HKMA will continue to work with the banking
customer experience is improving.
industry, business community and stakeholders to deal with this global and very complex
issue. And if you have any ideas and comments, please feel free to raise it at the panel
discussion, or you may approach your "targeted" banks at the networking session that
follows, or make use of the HKMA's dedicated webpage and email account to provide
feedback to us.
10. I have talked long enough and now is the time for me to pass the stage to Mr Charles Ng,
Associate Director-General of Investment Promotion of InvestHK, co-organiser of today's
event, to say a few words. Charles, please.