This screenshot taken on March 17, 2023 shows the official website of the Securities and Futures Commission of Hong Kong.
SYDNEY/HONG KONG – Hong Kong’s securities watchdog said on Thursday it was closely monitoring the situation in the global banking sector as Asian regulators played down contagion risks after a crisis of confidence triggered a market sell-off.
A plunge in shares of Credit Suisse on Wednesday sparked fears of a full-blown banking crisis. The bank on Thursday announced it would borrow up to 50 billion Swiss francs ($54 billion) from the Swiss central bank.
The Securities and Futures Commission of Hong Kong said it was "closely monitoring the situation to assess the impact" on the city's market
Responding to a Reuters query on the Credit Suisse stock collapse and wider market vulnerabilities, the Securities and Futures Commission of Hong Kong said it was "closely monitoring the situation to assess the impact" on the city's market.
The SFC said it has "maintained close dialogue with other financial regulators" and the Hong Kong stock exchange on this matter.
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The Hong Kong Monetary Authority said it had been monitoring developments in overseas financial markets and that it would "maintain close dialogues with relevant overseas supervisory authorities".
Australian Treasurer Jim Chalmers on Thursday said that local banks were well capitalized. He had convened a meeting this week between major regulators and the central bank after the collapse of Silicon Valley Bank.
"Our regulators are on top of things, our banks well-capitalized with strong liquidity positions, but it's still a reminder of the risks, uncertainties and vulnerabilities in the global economy as interest rates rise," said Chalmers.
He made no mention of Credit Suisse, shares of which tanked by up 30 percent on Wednesday before it was given access to a liquidity lifeline by the Swiss National Bank (SNB).
The head of Japan's banking lobby, meanwhile, said there were no signs at the moment of the Japanese financial system being affected by a crisis of confidence in Credit Suisse, adding that the country's banks are well-capitalized.
READ MORE: Swiss blank check wins some time for Credit Suisse
In South Korea, the Financial Services Commission (FSC), said it was considering having its banks hold more capital to prepare for instability.
Its statement said it was considering raising the countercyclical capital buffer (CCyB) ratio from the current zero percent as early as the second half of this year.
The CCyB is designed to be adjusted to create buffers that strengthen the resilience of the banking sector during periods of stress.