Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON

MarketScreener Homepage  >  News  >  Economy & Forex

News : Latest News
Latest NewsCompaniesMarketsEconomy & ForexCommoditiesInterest RatesBusiness LeadersFinance Pro.CalendarSectors 
All NewsEconomyCurrencies & ForexEconomic EventsCryptocurrenciesCybersecurityPress Releases

Hong Kong digital banks launch faces delay due to protests - sources

09/17/2019 | 07:15pm EST
FILE PHOTO: Nearby buildings are reflected on the exterior of a commercial tower at the financial Central district in Hong Kong

HONG KONG (Reuters) - The launch of new online-only banks in Hong Kong is expected to be delayed in part due to anti-government protests in the city, people with direct knowledge of the matter said.

Most of the eight newly licensed digital banks in Hong Kong, including joint ventures involving Standard Chartered and Bank of China Hong Kong, had aimed to begin operating before the end of 2019.

But as protests stretch into a fourth month, the new banks, seen triggering the biggest shake-up to Hong Kong's retail banking sector in years, will now launch early in 2020, the people told Reuters.

A delay would be the latest sign of the damage being wrought on the Asian financial hub's economy due to the political turmoil that erupted in June.

Some of these so-called virtual banks had aimed to launch brand promotion campaigns as early as this month, but these plans have now been put off, the people said, on condition of anonymity give the sensitivity of the matter.

"This form of banking service is mainly aimed at the youth, millennials, and many of them are out on the street these days joining the protests," a senior executive at a licence winner said.

"It will be difficult to launch a brand campaign around them and attract their interest when their priority is clearly not having another bank account," said the executive, declining to be named as he was not authorised to talk to media.

More than 100 days of sometimes violent protests were sparked by a bill that would have drawn the semi- autonomous Chinese territory closer to the mainland Chinese legal system. The bill was withdrawn earlier this month, but the protests have since broadened into calls for universal suffrage.

Hong Kong awarded virtual banking licences to three groups in March - joint ventures led by StanChart and BOC Hong Kong, and a subsidiary of the international arm of Chinese online insurer ZhongAn Online P&C Insurance.

The banks intended to launch services in six-to-nine months, the Hong Kong Monetary Authority (HKMA) said at that time.

Five more licences were issued later to joint ventures led by smartphone maker Xiaomi and Tencent, and a unit of Ant Financial among others.

HKMA said starting six-to-nine months after authorisation was "not a rigid requirement", but services were expected to be rolled out to the public in the fourth quarter at the earliest based on the virtual banks' latest indications.

StanChart said its virtual bank joint venture was working towards a launch in early 2020. Livi VB Ltd, the virtual banking joint venture led by BOC Hong Kong, said it was working towards the launch in the near future. ZhongAn declined to comment.

A spokeswoman for the Xiaomi-led joint venture said the virtual banking business was in the preparation stage, while Ant said that work for its bank was progressing smoothly. Tencent led-Fusion bank did not respond to a request for comment.

SOFT LAUNCH

A couple of the licence winners could still 'soft launch' in 2019, restricting services to staff and their families ahead of a full launch, the people said.

The virtual banks plan to offer savings accounts, credit cards, personal loans and travel insurance, and will try to take market share from HSBC, StanChart and some Chinese lenders who currently dominate retail banking in Hong Kong.

The launch delay is also partly due to the time required to build technology infrastructure, compliance and customer acquisition processes, and hire staff, the people said.

"This is about building a new bank from ground zero, with regulatory standards that are similar to traditional banks," one person said.

(Reporting by Sumeet Chatterjee and Alun John; Editing by Stephen Coates and Himani Sarkar)

By Sumeet Chatterjee and Alun John


© Reuters 2019
Stocks mentioned in the article
ChangeLast1st jan.
BOC HONG KONG (HOLDINGS) LIMITED -1.96% 24.95 End-of-day quote.-7.76%
DEERE & COMPANY -1.94% 256.43 Delayed Quote.50.94%
HSBC HOLDINGS PLC -0.54% 396.25 Delayed Quote.-32.71%
HUB CO., LTD. 0.00%End-of-day quote.0.00%
HUB CO., LTD. -0.50% 592 End-of-day quote.-43.19%
PING AN INSURANCE GROUP COMPANY 2.18% 89.15 End-of-day quote.4.32%
STANDARD CHARTERED PLC -2.12% 460.6 Delayed Quote.-33.89%
TENCENT HOLDINGS LIMITED 2.27% 586 End-of-day quote.56.02%
XIAOMI CORPORATION 1.72% 26.6 End-of-day quote.146.75%
ZHONG AN GROUP LIMITED 0.00% 0.335 End-of-day quote.41.35%
ZHONGAN ONLINE P & C INSURANCE CO., LTD. 3.88% 37.45 End-of-day quote.33.27%
Latest news "Economy & Forex"
10:53aANALYSIS : Turkish lira stuck between bullish foreigners, bearish locals
RE
10:53aWorld shares hold close to record highs; U.S. markets close for Thanksgiving
RE
10:53aRHA ROAD HAULAGE ASSOCIATION : welcomes Road Freight APPG report on Clean Air Zones
PU
10:52aSpain moves from stick to carrot to persuade later retirement
RE
10:50aOil rally stalls on signs of more supply, demand doubts
RE
10:39aCESKA NARODNI BANKA : Update of Financial Stability Report 2019/2020
PU
10:33aCENTRAL BANK OF MONTENEGRO : Meeting with the Executive Director of the Belgian-Dutch Constituency at the IMF
PU
10:24aEuro retreats after early gains; Swedish crown falls after Riksbank QE expansion
RE
10:17aAMMC AUTORITE MAROCAINE DU MARCHE DES CAPITAUX : Buy Back programm DO/EM/13/2020
PU
10:11aDYNACOR GOLD MINES : Declares its Q4-2020 Quarterly Dividend
PU
Latest news "Economy & Forex"