... adjustment of its operating environment assessment for Hong Kong banks to a mid-point of `a' with stable trend from `a+/negative' captures the growing connectivity between the economies and financial systems of Hong Kong and China, which has weaker governance standards. We also take into account the significant spill-over risks to the economy from the buoyant local property market, even though the banks have relatively small direct exposure. High Macro-Prudential Risk: Our assessment takes into account Hong Kong's high macro- prudential risk, as signalled by its long-standing MPI 3 score on Fitch's Macro-Prudential Risk Indicator, which has been repeatedly triggered since 2010 due to above-trend credit growth and high property price inflation ¡ being driven by demand from China. Open Economy: Hong Kong's small, flexible and open economy with unparalleled access to China provides its banks growth opportunities, which are rare in mature markets....
