HKMA Announces Banking License, Penalties and Guidance on Data-Sharing
The Hong Kong Monetary Authority (HKMA) granted a restricted banking license to Korea Development Bank (incorporated in the Republic of Korea) under the Banking Ordinance. HKMA also imposed pecuniary penalties of HKD 44,200,000 against China Construction Bank (Asia) Corporation Limited (CCBA), CTBC Bank Co., Ltd., Hong Kong Branch (CTBCHK), Industrial and Commercial Bank of China (Asia) Limited (ICBCA), and UBS AG, Hong Kong Branch (UBSHK) as well as issued orders for remedying the contraventions where warranted. The investigations followed a series of on-site examinations conducted by HKMA on banks’ systems and controls for compliance with the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (AMLO). Additionally, HKMA issued guidance to authorized institutions on sharing of personal data of customers for direct marketing by third parties.
Given the special trust relationship between authorized institutions and their customers and considering that some of the third parties are not subject to any regulatory regime like that of authorized institutions, for the sake of better safeguarding personal data of banking customers, HKMA considers that the banking industry should aspire to a higher standard regarding sharing of customers’ personal data with third parties for the purpose of direct marketing. Under the guidance, there are two general approaches that authorized institutions may adopt for sharing customers’ personal data for direct marketing by third parties by:
- asking customers to directly approach the third parties such that the customers may provide their personal data directly to the third parties; or
- redirecting the customers from authorized institutions’ website/mobile apps to the websites/mobile apps of the third parties for provision of their personal data and/or consent for direct marketing by such third parties.
The guidance also stipulates how redirection should be made, the types of customers’ personal data that may be shared with third parties in different circumstances under the redirection approach, and other guiding principles on the sharing of customers’ personal data to third parties. The guidance will take effect on January 01, 2022 such that any new applicable initiatives to be launched by authorized institutions from that date should comply with the guidance. For authorized institutions’ existing applicable arrangements, authorized institutions are expected to comply with the guidance as soon as practicable and in any case not later than six months from the effective date (that is, by June 30, 2022).
Keywords: Asia Pacific, Hong Kong, China, Banking, Bank Licenses, AMLO, AML/CFT, Penalty, Internal Controls, Operational Risk, Data Sharing, Guidance, HKMA
Previous Article
ESMA Updates Q&A, Sets Out Standards on Benchmark TransitionRelated Articles
BIS and Central Banks Experiment with GenAI to Assess Climate Risks
A recent report from the Bank for International Settlements (BIS) Innovation Hub details Project Gaia, a collaboration between the BIS Innovation Hub Eurosystem Center and certain central banks in Europe
Nearly 25% G-SIBs Commit to Adopting TNFD Nature-Related Disclosures
Nature-related risks are increasing in severity and frequency, affecting businesses, capital providers, financial systems, and economies.
Singapore to Mandate Climate Disclosures from FY2025
Singapore recently took a significant step toward turning climate ambition into action, with the introduction of mandatory climate-related disclosures for listed and large non-listed companies
SEC Finalizes Climate-Related Disclosures Rule
The U.S. Securities and Exchange Commission (SEC) has finalized the long-awaited rule that mandates climate-related disclosures for domestic and foreign publicly listed companies in the U.S.
EBA Proposes Standards Related to Standardized Credit Risk Approach
The European Banking Authority (EBA) has been taking significant steps toward implementing the Basel III framework and strengthening the regulatory framework for credit institutions in the EU
US Regulators Release Stress Test Scenarios for Banks
The U.S. regulators recently released baseline and severely adverse scenarios, along with other details, for stress testing the banks in 2024. The relevant U.S. banking regulators are the Federal Reserve Bank (FED), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC).
Asian Governments Aim for Interoperability in AI Governance Frameworks
The regulatory landscape for artificial intelligence (AI), including the generative kind, is evolving rapidly, with governments and regulators aiming to address the challenges and opportunities presented by this transformative technology.
EBA Proposes Operational Risk Standards Under Final Basel III Package
The European Union (EU) has been working on the final elements of Basel III standards, with endorsement of the Banking Package and the publication of the European Banking Authority (EBA) roadmap on Basel III implementation in December 2023.
EFRAG Proposes XBRL Taxonomy and Standard for Listed SMEs Under ESRS
The European Financial Reporting Advisory Group (EFRAG), which plays a crucial role in shaping corporate reporting standards in European Union (EU), is seeking comments, until May 21, 2024, on the Exposure Draft ESRS for listed SMEs.
ECB to Expand Climate Change Work in 2024-2025
Banking regulators worldwide are increasingly focusing on addressing, monitoring, and supervising the institutions' exposure to climate and environmental risks.
