Hong Kong Likely To Stay Supportive Toward Banks With Effective Resolution Regime In Place; No Immediate Rating Impact

HONG KONG (S&P Global Ratings) March 4, 2019--The Hong Kong government is likely to remain supportive toward its private sector banks if needed, even with an effective resolution framework in place, S&P Global Ratings said today. The Financial Institutions (Resolution) loss-absorbing capacity (LAC) requirements took effect on Dec. 14, 2018. We do not expect any immediate rating impact on Hong Kong banks. In our view, Hong Kong's resolution framework for banks can be considered effective. Based on the scope and LAC requirement rules, which are broadly in line with our expectations, Hong Kong joins Canada to be the only two countries to have an effective resolution regime and still have its systemically important banks benefit from government support. NO CHANGE

...HONG KONG (S&P Global Ratings) March 4, 2019--The Hong Kong government is likely to remain supportive toward its private sector banks if needed, even with an effective resolution framework in place, S&P Global Ratings said today. The Financial Institutions (Resolution) loss-absorbing capacity (LAC) requirements took effect on Dec. 14, 2018. We do not expect any immediate rating impact on Hong Kong banks. In our view, Hong Kong's resolution framework for banks can be considered effective. Based on the scope and LAC requirement rules, which are broadly in line with our expectations, Hong Kong joins Canada to be the only two countries to have an effective resolution regime and still have its systemically important banks benefit from government support. NO CHANGE TO GOVERNMENT SUPPORT ASSESSMENT In our view, the Hong Kong government is likely to remain supportive toward its private sector banks because the bail-out of a bank without asking senior unsecured creditors to absorb losses remains...

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