the reserve bank to reconsider the existing accommodation arrangements between the bank and private banking institutions. at this stage, the bank would like to give notice of the proposed introduction of a new, more flexible accommodation facility, to be created in the form of regular repurchase transactions between the reserve bank and its banking sector clients. the private banks will be offered the opportunity to tender on a regular basis for central bank funds through the repurchase facility, and accordingly be given more scope to manage their own liquidity positions better. furthermore, the purpose of the minimum cash reserve accounts that banks must maintain with the reserve bank will be extended to serve also as operational accounts for the regular settlement of clearing account balances. an averaging principle will be introduced, in terms of which each bank will have to ensure that the average daily balance in its account over a monthly period will comply with the prescribed minimum cash reserve requirements. this should enable the banks, during the course of the month, to use their minimum reserve balances for settlement purposes. the present discount window facility will still be retained to provide banks with a further source of funds for the management of their liquidity positions. it is envisaged, however, that the bank rate for such loans will be at a substantial premium to the fluctuating effective interest rate as established in the regular repurchase transactions. the department of finance is planning to implement new arrangements for the primary issue of, and the secondary market - making in, government bonds through appointed private market securities dealers. the transfer of these functions from the reserve bank to securities dealers will strengthen the reserve bank ’ s ability to pursue open - market operations more vigorously for monetary policy purposes. the bank is now in the process of preparing a discussion document on the proposed new accommodation procedures. this document will be distributed to the banking community and to other interested parties before the end of october for comments and participation in the preparation of the new system. - 11 - it must not be expected, however, that the introduction of the new system will lead to a permanently lower level of interest rates. the reserve bank may well in future use interest rates more frequently and extensively to pursue its overriding objective of protecting the value of the currency. the bank will nevertheless have to ensure that interest rates will be maintained at a level that will be consistent with all the other objectives of monetary policy, and with developments in other economic aggregates. internal administration of the bank with the appointment of mr. james cross as deputy governor from 1

services and promoted market development. to amcm, last year was a year of consolidating the financial sector through continued enhancement of financial risk supervision. in the aftermath of the financial crisis, amcm followed up - to - date development of international financial supervision, continued to strengthen financial supervisory work in line with the fresh standards and requirements imposed by the basel committee on banking supervision. at the same time, amcm rolled out specific guidelines on risk mitigation, which reinforced the legal aspect of financial risk management to assist our practitioners in their risk - aversion endeavour. through the collective endeavour of our financiers, the macao banking sector, in the midst of overall economic recovery, scored results with flying colours again, which laid down solid foundation in the realization of our long term sustainable development. as per the end of 2010, total assets of the banking sector amounted to mop540 billion, a year - on - year growth of 26. 5 % ; aggregate deposits totalled mop341. 5 billion, a year - on - year growth of 11. 3 %, while loan portfolio stood at mop245. 7 billion, a year - on - year growth of 31. 7 %, making a loan deposit ratio of 71. 9 % ; initial overall profit for the banking sector amounted to mop3. 54 billion. the whole banking sector had a high capital adequacy ratio of 15. 3 %, bis central bankers ’ speeches which far exceeded international standard ; non - performing loan ratio was a meagre 0. 4 %, which reflected fine asset quality. as for rmb business, as per end of 2010, rmb deposits amounted to rmb 13. 3 billion, a year - on - year expansion of 5. 9 times ; in february 2011, it went up to rmb23. 2 billion, an increase of 74. 4 % compared to 2010 end. at the same time, banks settled rmb business valued at rmb6 billion for the period starting october 2009, when cross border rmb trade settlement business started, to end of 2010. moreover, to widen the spectrum for investment and fund management for macao residents and institutions, with the green light given by the people ’ s bank of china, the settlement channel for macao entities in the purchase of rmb bonds issued in hong kong was opened. in the realm of insurance supervision, apart from perfecting offsite surveillance measures, the inspection and app