Follow-up actions to be taken by the Administration
The Administration was requested to undertake in writing that
(a) a resolution authority, when resolving a failing bank, could only transfer the protected deposits to a bridge institution that was authorized under the Banking Ordinance (Cap. 155) and also a member of the Deposit Protection Scheme; and
(b) the Government would review the relevant legislative provisions and introduce necessary amendments to clearly reflect its position as stated in (a) above in a future legislative exercise.
The Subcommittee further agreed that the Administration should give the above undertaking at the debate on the motion to take note of the relevant report of the House Committee on consideration of subsidiary legislation and other instruments pursuant to Rules 49E(1) of the Rules of Procedure at the Council meeting of 5 July 2017.
The Chairman said that the Subcommittee had completed scrutiny of the Financial Institutions (Resolution) (Protected Arrangements) Regulation and the Financial Institutions (Resolution) Ordinance (Commencement) Notice 2017 (“the two pieces of subsidiary legislation”) and would not propose any amendment to them.
The Subcommittee noted that the motion to extend the scrutiny period of the two pieces of subsidiary legislation to the Council meeting of 5 July 2017 was passed at the Council meeting of 7 June 2017. The Chairman would give a verbal report on the deliberations of the Subcommittee at the House Committee meeting on 23 June 2017. The deadline for giving notice of motion to amend the two pieces of subsidiary legislation would be 27 June 2017.