In July 2020, the Hong Kong Monetary Authority (HKMA) launched a consultation paper foreshadowing a Code of Practice for Trust Business. The code will contain general principles and practical standards to govern the conduct of authorized institutions (AIs, being principally banks) and their subsidiaries that conduct trust business in Hong Kong.
The Hong Kong Monetary Authority (HKMA) has released a Consultation Paper on Enhancing the Regulation and Supervision of Trust Business (Consultation Paper). The HKMA plans to introduce a Code of Practice for Trust Business (Code) to be incorporated into a new Supervisory Policy Manual (SPM) applicable to all authorized institutions (AIs) and local subsidiaries of locally incorporated AIs (AI subsidiaries) conducting trust business in Hong Kong. The aim of the Code is to enhance protection of client assets held on trust and better align with international standards and practices to promote the fair treatment of customers and a customer-centric culture in the trust business. We discuss some of the HKMA’s proposals and their potential application.