Hong Kong Exchange Fund Totals US$225.65 Billion

For more information, please contact:
Melissa Ng /David Hsieh at 212-752-3320
Daniel McAtee at 202-238-6360
Wing Yan Tong at 415-835-9315

June 30, 2009 - Total assets of the Hong Kong Exchange Fund amounted to HK$1,760.1 billion (US$225.65 billion) on May 31, 2009. This is HK$114.7 billion (US$14.7 billion) higher than at the end of April 2009, according to the Hong Kong Monetary Authority.

Foreign currency assets increased by HK$98.1 billion (US$12.57 billion) and Hong Kong dollar assets increased by HK$16.6 billion (US$2.12 billion).

The rise in foreign currency assets was due mainly to purchases of foreign currencies with Hong Kong dollars and valuation gains on foreign currency investments. The rise in Hong Kong dollar assets was due mainly to an increase in the balance of the banking system and valuation gains on Hong Kong equities held by the Exchange Fund. These increases were partly offset by sales of Hong Kong dollars for foreign currencies.

The Currency Board Account shows that the Monetary Base at the end of May 2009 was HK$690.3 billion (US$88.5 billion), an increase of HK$71.5 billion (US$9.16 billion), or 11.5%, from the end of April 2009. The rise was due mainly to an increase in the Aggregate Balance, which was partly offset by a decrease in Certificates of Indebtedness.

The Backing Assets increased by HK$71.0 billion (US$9.1 billion), or 10.7%, to HK$733.9 billion (US$94.08 billion). The increase was attributable mainly to an increase in the Aggregate Balance and interest from investments. These increases were partly offset by the redemption of Certificates of Indebtedness in the Monetary Base and revaluation losses. Reflecting this, the backing ratio declined from 107.13% at the end of April 2009 to 106.32% at the end of May 2009.