HK: Probe into minibonds bankers wins support

Bonnie ChenandAdele Wong
Monday, November 10, 2008

The chances of bankers being summoned to explain the Lehman Brothers minibond fiasco grew stronger yesterday after the largest party in the Legislative Council indicated support for such a motion.

The move comes despite a warning by Secretary for Financial Services and the Treasury Ceajer Chan Ka-keung that the concern raised by foreign banks over a legislative inquiry may have an adverse effect on the business environment.
Chan said he believes the banks involved would probably buy back the minibonds next month.

The motion to summon bankers can only be passed if it gets majority support from lawmakers representing both the geographical and functional constituencies.

Thirteen of the functional constituency lawmakers are expected to support the motion but they will still need at least three votes from the Democratic Alliance for the Betterment and Progress of Hong Kong.

DAB chairman Tam Yiu-chung said the party will decide tomorrow whether a Legco investigation will affect the time of compensation and Hong Kong's status as an international financial center.

But another DAB member, Wong Tin-kwong representing the import and export sector, said he was inclined to support the motion.

"If the issue is to be investigated, it has to be tackled in the right direction," he said.

Only three former Liberal Party members and David Li Kwok-po of the finance sector have said they will vote against the motion. However, the pan-democrats said Li should not vote since he is chairman of the Bank of East Asia.

Civic party chairwoman Audrey Eu Yuet-mee said an open investigation by Legco would be fair to all sides. A source said the government is trying to get the DAB and some functional constituency independent legislators to vote against the motion.