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The Bank of China Hong Kong (Holdings) Limited (BOCHK) has decided to set up a special committee to ensure the continuing integrity of the credit approval, risk management and internal control processes of the company.
The company announced the decision in a statement issued Tuesday night.
The BOCHK said that the special committee comprises Anthony Neoh SC, senior advisor to the board, Weijian Shan and Victor Fung, both independent non-executive directors, who will undertake a comprehensive review of the credit approval process, risk management and internal control mechanism of the BOCHK.
The special committee will be authorized to engage external advisers and auditors for help in conducting their review, and their terms of reference will be drafted in consultation with the Hong Kong Monetary Authority, according to the BOCHK.
The company reiterated that the Audit Committee of the Board has reviewed the approval process of the BOCHK in relation to the New Nongkai Loan and reached conclusion that the loan was processed in the normal manner.
The BOCHK noted that based on information available so far, its loan to New Nongkai shall not have material adverse impact on the financial position of the company.
In the statement, the BOCHK also said that it has just received confirmation from the Bank of China in Beijing that the latter had on June 7, 2003 been informed by the State Authorities in Beijing that Liu Jinbao has become the subject of a formal investigation.
The company has also been informed by the Bank of China that to the best of the knowledge of their senior management, no investigations by the State Authorities regarding Liu began until sometime after his transfer back to Beijing and that the investigations are at present restricted to loans made through the Shanghai Branch of the Bank of China, the statement said.
It said the Bank of China is providing the fullest possible assistance to the authorities concerned in these investigations.
(Xinhua News Agency June 11, 2003)
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