the hong kong dollar swap market also reduced notably by 32 % from hk $ 263 billion to hk $ 179 billion in the same period. while the hong kong banking sector is now faced with ample liquidity, the situation will not be permanent and we will need to find new ways to facilitate efficient interbank borrowing. development of the repo market will help to activate the money market by addressing the credit risk through the collateralized arrangement. the cross - border funding issue is particularly important to hong kong given its role as an international banking centre. 139 of the 199 authorized institutions in hong kong are either branches or subsidiaries of banking groups incorporated outside of the territory. an important function of the new service is to enable financial institutions to make use of securities held in one of the partner systems as collateral to conduct secured borrowing in the hong kong dollar or renminbi in hong kong. as an example, a bank in europe can make use of its securities held with euroclear bank or j. p. morgan to borrow hong kong dollar to meet the liquidity needs of its hong kong subsidiary. the enhanced capability of authorized institutions to manage the liquidity needs in the local currency, no doubt, will help to maintain financial stability in hong kong. bis central bankers ’ speeches the facility will also substantially strengthen hong kong ’ s role as the global hub for offshore renminbi business. being the first mover in developing offshore renminbi business, hong kong has the largest offshore renminbi liquidity pool, amounting to rmb 674 billion at the end of april 2012, and has developed a vibrant cnh market and the largest offshore rmb bond market. more foreign banks are either choosing to have a base in hong kong or are using rmb correspondent banking services provided by banks in hong kong. as at the end of may 2012, there were 196 banks participating in hong kong ’ s renminbi clearing platform. of these, 170 are foreign - owned or located overseas. at the same time, over 1, 100 renminbi correspondent accounts were maintained by overseas banks with banks in hong kong. the amount due to and due from such overseas banks amounted to rmb 128 billion and rmb 146 billion respectively. this is a clear indication that banks from around the world are using hong kong ’ s robust platform and large liquidity pool to offer renminbi services to their customers at home. as more and more companies and financial institutions conduct business and transactions in the renminbi, we will see

which has proved essential to growing our global financial business and underscores our legacy of innovation in financial infrastructures. however, to remain competitive in an ever - evolving landscape, we must continuously build upon this rich heritage. as financial technology takes centre stage in the future of finance, we invite you to join us in showcasing hong kong's innovative mindset and ability to conduct pioneering work in the tokenisation market. by doing so, we not only reinforce hong kong's status as a premier international financial centre, but also create an environment for new business opportunities, talent and expertise. our commitment to innovation will continue to draw global players and skilled professionals to our city, fostering a vibrant digital asset ecosystem. together, we can position hong kong as a leader in the financial technology revolution, ensuring that we remain at the forefront of the global financial landscape. thank you. 3 / 4 bis - central bankers'speeches 4 / 4 bis - central bankers'speeches