Govt welcomes deposit bill passage

The Government welcomed the passage of an amendment bill to enhance the Deposit Protection Scheme (DFS) by the Legislative Council today, raising the protection limit from the current $500,000 to $800,000.

Other enhancements to the scheme include refining the levy system to enable the DPS Fund underpinning the scheme to reach the target fund size within a reasonable timeframe under the increased protection limit.

The enhanced scheme will also provide more coverage to affected depositors upon a bank merger or acquisition.

It will require the display of the DPS membership sign on the electronic banking platforms of DPS members; and streamline the negative disclosure requirement on non-protected deposit transactions for private banking customers.

Secretary for Financial Services & the Treasury Christopher Hui said the Deposit Protection Scheme (Amendment) Ordinance 2024 can help further strengthen the function of the scheme in the financial safety net, enhance depositors' confidence and raise the resilience of the banking sector and the overall stability of the financial system, thereby reinforcing Hong Kong's position as an international financial centre.

The amendment ordinance will be gazetted on July 12 and implemented in two phases.

The first phase, which comes into effect on October 1, will cover measures requiring a shorter period of preparatory work, such as the enhancement of the protection limit to $800,000.

The second phase, which covers other measures, will be implemented on January 1, 2025.