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World China Banks Act to Comply With Trump Sanctions on Hong Kong

12:52  12 august  2020
12:52  12 august  2020 Source:   bloomberg.com

France will not ratify its extradition agreement with Hong Kong

 France will not ratify its extradition agreement with Hong Kong FRANCE-HONG-KONG: France will not ratify its extradition agreement with Hong Kong PARIS (Reuters) - France will not ratify as it stands The extradition agreement signed in 2017 between France and Hong Kong due to the "rupture" caused by the implementation, at the end of June, of the new law on national security in the Chinese region, the ministry said on Monday. Foreign Affairs.

China on Wednesday sharply criticized President Trump ’s moves to strip Hong Kong of its preferential trading status with the United States and clear the way for new sanctions on officials and companies there, vowing to retaliate with punitive measures of its own. The response from the Ministry of Foreign

The Bank of China says the country should prepare for potential US sanctions by increasing use of its own financial messaging network for Chinese state lenders have reportedly been bracing for potential US sanctions for serving officials who implement the new national security for Hong Kong .

(Bloomberg) -- China’s largest state-run banks operating in Hong Kong are taking tentative steps to comply with U.S. sanctions imposed on officials in the city, seeking to safeguard their access to crucial dollar funding and overseas networks.

a tower that has a sign on a pole: The China Construction Bank Corp. headquarters stand in Hong Kong, China, on Wednesday, March 28, 2018. China's biggest banks are set for a boost in valuations as analysts expect a strengthening economy will fuel loan demand and margins. © Bloomberg The China Construction Bank Corp. headquarters stand in Hong Kong, China, on Wednesday, March 28, 2018. China's biggest banks are set for a boost in valuations as analysts expect a strengthening economy will fuel loan demand and margins.

Major lenders with operations in the U.S. including Bank of China Ltd., China Construction Bank Corp., and China Merchants Bank Co. have turned cautious on opening new accounts for the 11 sanctioned officials, including Hong Kong Chief Executive Carrie Lam, according to people familiar with the matter. At least one bank has suspended such activity.

U.S. Poised to Sanction Hong Kong Chief Carrie Lam for Crackdown

  U.S. Poised to Sanction Hong Kong Chief Carrie Lam for Crackdown The Trump administration is poised to impose sanctions on Chinese officials and their allies in Hong Kong, including Chief Executive Carrie Lam, as soon as Friday over their role in curtailing political freedoms in the former U.K. colony, according to three people familiar with the matter. The measures would also target Communist Party officials, according to two of the people. All of the people spoke on condition of anonymity because the sanctions haven’t yet been announced.

The new law calls for sanctions against “primary offenders” undermining Hong Kong ’s autonomy but doesn’t require the administration to act immediately. Trump had threatened to take action ever since Chinese officials imposed a sweeping national security law on Hong Kong about two weeks ago.

Mr Trump said the Hong Kong Autonomy Act provided “powerful new tools to hold responsible the individuals and the entities involved in extinguishing Mr Van Hollen and Pat Toomey, a Republican senator who co-sponsored the law, said it would “impose mandatory secondary sanctions on banks

At some lenders transactions via the U.S. are banned, while compliance must now review and sign off on others that would previously have been immediately processed, the people said.

Foreign lenders like Citigroup Inc. have taken steps to suspend accounts or are increasing scrutiny of Hong Kong clients.

Such measures underscore the ability of the U.S. to use the greenback’s dominance in international transactions as a pressure point in the intensifying standoff with China. China’s state-owned lenders need to preserve their access to global financial markets, particularly at a time when Beijing is leaning on them to prop up the economy from the fallout of the coronavirus.

China’s four largest banks had $1.1 trillion in dollar funding at the end of 2019, according to Bloomberg Intelligence.

Carrie Lam: US sanctions Hong Kong chief executive over democratic crackdowns

  Carrie Lam: US sanctions Hong Kong chief executive over democratic crackdowns The US sanctioned Hong Kong Chief Executive Carrie Lam Friday for her role in crackdowns on political freedom in the region. © NICOLAS ASFOURI/AFP/Getty Images Hong Kong Chief Executive Carrie Lam has announced the delay of the city's legislative elections. The US Treasury Department charged that Lam and 10 other individuals "have implemented policies directly aimed at curbing freedom of expression and assembly, and democratic processes, and are subsequently responsible for the degradation of Hong Kong's autonomy.

Chinese firms with shares traded on US stock exchanges could lose their listings if they won’t comply with US audit requirements, Treasury Secretary “As of the end of next year, if they do not fully comply , and that’s Chinese companies [and] any other companies, because they all have to comply

That means Hong Kong is exempt from Trump ’s punitive tariffs on China , can import certain sensitive technologies and enjoys U.S. support for its participation in international Sanctioning individual Chinese officials and entities would leave in tact the broader trading relationship, which serves the

Read more: China Seeks to Calm U.S. Tensions

Representatives at Bank of China and Construction Bank didn’t respond to requests seeking comments. China Merchants Bank declined to comment. The Hong Kong government didn’t immediately respond to a request for comment.

U.S. President Donald Trump last week sanctioned Chinese and Hong Kong officials including Lam, Xia Baolong, director of the Hong Kong and Macau Affairs Office of China’s State Council, and Chris Tang, commissioner of the city’s police for their role in implementing a security law in Hong Kong. The officials will have property and assets in the U.S. frozen.

The sanctions forbid banks from doing business with the penalized individuals or risk penalties that would threaten their access to the U.S. financial system.

China on Monday retaliated by sanctioning 11 individuals including U.S. senators Marco Rubio and Ted Cruz, but stopped short of putting any senior American government officials on its list. Its top diplomat, Yang Jiechi, on Friday said the door for talks with the U.S. remains open.

Beijing's top Hong Kong office says U.S. sanctions are 'clowning actions' and 'ridiculous'

  Beijing's top Hong Kong office says U.S. sanctions are 'clowning actions' and 'ridiculous' Beijing's top Hong Kong office says U.S. sanctions are 'clowning actions' and 'ridiculous'The United States on Friday imposed sanctions on Luo Huining, the head of China's Liaison Office, as well as Hong Kong leader Carrie Lam and other current and former officials that Washington accuses of curtailing political freedoms in the global financial hub.

The legislation would impose sanctions on officials responsible for instituting and enforcing China ’s new security law targeting Hong Kong ’s autonomy. Lawmakers in both political parties have increasingly pressed the Trump administration to challenge China on a litany of abuses, mustering a

“If Hong Kong loses preferential trade treatment, U.S. tariffs and export controls on China would Bipartisan support is also growing in Congress for sanctions on mainland Chinese officials and Concerns among Trump administration national security officials over Hong Kong escalated last year

It didn’t clarify the potential implications for any financial institutions that keep doing businesses with those named.

”China’s position on the U.S. sanctions is clear and consistent,” Foreign Ministry spokesman Zhao Lijian told reporters in Beijing on Wednesday in response to a question about the banks’ move to comply. “The U.S. sanctions are irrational and groundless. They are unanimously opposed and condemned by all Chinese people, including our residents in Hong Kong.”

Read more ...

Citi, StanChart Eye Accounts of Sanctioned Hong Kong Officials

U.S. Hong Kong Sanctions Risk $1.1 Trillion in China Funding (1)

How Hong Kong Sanctions Could Threaten Wall Street: QuickTake

Bank of China had the biggest exposure to U.S. dollars among its local peers, followed by Industrial & Commercial Bank of China Ltd., the world’s largest bank. The lenders have been expanding their presence globally over the past decade by adding branches, making acquisitions and granting loans to fund everything from local power plants to toll roads.

Meanwhile, local banks in Hong Kong are concerned as well since they all have some U.S. dealings such as foreign exchange and settlement, one person said.

The Hong Kong Monetary Authority, the city’s de facto central bank, sought to ease concerns on Saturday, saying lenders in the city have no obligation to follow U.S. sanctions under local law, urging banks to treat customers fairly in assessing whether to continue to providing services.

Despite the announcement, “banks that have U.S. operations or conduct dollar businesses may still need to consider their U.S. compliance obligations,” JPMorgan Chase & Co.’s Hong Kong-based analysts led by Katherine Lei wrote in a note. “Risks for listed China banks are relatively muted, in our view, as the four China officials on the list may obtain banking services with local unlisted Chinese banks that do not have dollar or U.S. businesses.”

(Updates with comment from China in 12th paragraph.)

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Hong Kong Leader Carrie Lam Has Credit Card Trouble After U.S. Sanctions .
Hong Kong’s leader said she’s having trouble using her credit cards after the U.S. imposed sanctions targeting Chinese officials and their allies in the city. © Bloomberg Carrie Lam, Hong Kong's chief executive, speaks during a news conference in Hong Kong, China, on Friday, July 31, 2020. Hong Kong’s government will delay upcoming legislative elections, Lam said at a news conference on Friday evening.

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