Completion Instructions

Completion Instructions

Return of Relevant Deposits

Introduction

1. This return collects information on the amount of relevant deposits of each Scheme member. Based on the information contained in the return, as well as other relevant information supplied by the Monetary Authority (MA) (e.g. the MA supervisory ratings of individual Scheme members), the Hong Kong Deposit Protection Board (the Board) will assess the amount of contributions payable by each Scheme member.

Section A: General Instructions

1. All Scheme members are required to complete this return showing the positions of their Hong Kong offices as at 20 October of the year preceding the year of assessment (i.e. the amount of contributions for 2006 is assessed with reference to the amount of relevant deposits as at 20 October 2005). For new Scheme members, the reporting date should be the date when it becomes a member of the Scheme.

1. The return should be submitted to the Board not later than 2 months after the reporting date, unless otherwise specified by the Board. If the submission deadline falls on a public holiday, it will be deferred to the next working day.

1. Terms used in these completion instructions have the same meanings as in the Deposit Protection Scheme Ordinance (the DPS Ordinance). Specifically, the terms “relevant deposits” and “amount of relevant deposits” are defined in Schedule 1 and Schedule 4 to the DPS Ordinance respectively. Scheme members should familiarise themselves with these Schedules before completing the return.

1. Amounts should be shown to the nearest thousands, in HK$ or HK$ equivalent in the case of foreign currency items. The closing middle market T/T rates prevailing at the reporting date should be used for conversion purpose.

Section B: Specific Instructions

Part I – Amount of Relevant Deposits

Item 1 – Relevant deposits held by a depositor in his own right

1. Report in this item the amount of relevant deposits held by a depositor in his own right.

1. In reporting the amount of relevant deposits held by one person, as a depositor, with the Scheme member in his own right, the amount of relevant deposits that exceeds $100,000 should be excluded.

1. In the case of a joint account, a Scheme member may assume that the relevant deposit in the account is equally held by the account holders. The share of the relevant deposit attributable to each account holder should then be aggregated with the other relevant deposits of the account holder maintained with the Scheme member. Any amount in excess of $100,000 should be excluded in calculating the amount of relevant deposits attributable to that account holder.

1. In the case of partnership, the individual members of the partnership should be treated as a single and continuing body of persons as distinct from the persons who may from time to time be the members of the partnership. The relevant deposits held by the partnership should be treated as separate from the relevant deposits held by the individual partners in their own rights.

1. According to the definition of “relevant deposit”, a deposit held by an excluded person or, in the case of a joint deposit, that portion of the deposit attributable to the excluded person is not a relevant deposit.

1. The following examples illustrate how the above reporting principles operate.

Examples of treatment of deposits held by a depositor in his own right

Depositor /

Details

/ Balance
($) / Amount of
Relevant Deposits
($)
Mr. A / Current Account / 10,000
Savings Account / 20,000
Time Deposits / 50,000
80,000 / 80,000
Mr. B / Current Account / 20,000
Savings Account / 40,000
Time Deposits / 100,000
160,000 / 100,000
(Paragraph 7 – Amount in excess of $100,000 should be excluded)
Mr. C (an excluded person, e.g. a director of the reporting Scheme member) / Savings Account / 40,000
Time Deposits / 100,000
140,000 / 0
(Paragraph 10 – Deposits held by an excluded person are not relevant deposits)
Depositor /

Details

/ Balance
($) / Amount of
Relevant Deposits
($)
Mr. A / Time Deposits / 60,000

Mr. A’s Store

(a sole proprietorship) / Current Account / 50,000
110,000 / 100,000
(Paragraph 7 – Amount in excess of $100,000 should be excluded)

Examples of treatment of deposits held by two or more persons under a joint account

Depositor /

Details

/ Balance
($) / Amount of
Relevant Deposits
($)
Mr. D / Savings Account / 80,000
Mr. D and Mr. E, jointly / Time Deposits / 160,000
(D’s share: $80,000;
E’s share: $80,000)
D’s relevant deposits: / 100,000
E’s relevant deposits: / 80,000
Mr. F and Mr. G, jointly / Time Deposits / 160,000
(Mr. G is an excluded person) / (F’s share: $80,000;
G’s share: $80,000)
F’s relevant deposits: / 80,000
G’s relevant deposits: / 0
(Paragraph 10 – The portion of a deposit held by an excluded person is not a relevant deposit)
Mr. H / Time deposits / 80,000 / 80,000
H&I Partnership
(Mr. H and Mr. I as partners) / Savings Account / 160,000 / 100,000
(Paragraph 9 - Deposits held by the partnership should be treated as separate from deposits held by individual partners)

Item 2 – Relevant deposits held under trusts and bare trusts

1. Report in this item the amount of relevant deposits held by a trustee[1] under a trust and a bare trustee under a bare trust. Scheme members are not required to differentiate a trust from a bare trust for the purpose of reporting this return. For both types of trusts, the relevant deposits held under each trust should be treated as separate from the relevant deposits held by the trustee/ bare trustee or the beneficiary in his own right. The amount of relevant deposits held by a trustee/ bare trustee under a trust/ bare trust that exceeds $100,000 should be excluded.

1. A deposit held by a trustee/ bare trustee for an excluded person need not be excluded from the calculation of the amount of relevant deposits. This means that Scheme members are not required to look beyond the trustees/ bare trustees to identify the underlying beneficiaries of the trusts/ bare trusts so as to determine whether a beneficiary is an excluded person or not.

1. For deposits held by a trustee/ bare trustee under two or more trusts, the deposits held for one trust should be treated as separate from those held for other trusts.

1. The following examples illustrate how the above reporting principles operate.

Examples of treatment of deposits held under a trust/ bare trust

Depositor /

Details

/ Balance
($) / Amount of
Relevant Deposits
($)
XYZ Trustee (deposit held in its own right) / Savings Account / 80,000 / 80,000**
Mr. J / Savings Account / 60,000 / 60,000**
XYZ Trustee, in trust for Mr. J / Savings Account
Time Deposits / 100,000
150,000
250,000 / 100,000
(Paragraph 12 - Deposits held under the trust should be treated as separate from the deposits owned by XYZ trustee or the beneficiary – Mr. J in his own right)
XYZ Trustee, in trust for Mr. K (an excluded person) / Time Deposits / 160,000 / 100,000
(Paragraph 13 - Need not identify the underlying beneficiaries of the trust account)

** These deposits are held by the depositors in their own right and should be reported under item 1 of the return.

Depositor /

Details

/ Balance
($) / Amount of
Relevant Deposits
($)
XYZ Trustee, in trust for Mr. A / Time Deposits / 80,000 / 80,000
XYZ Trustee, in trust for Mr. B / Time Deposits / 60,000
140,000 / 60,000
(Paragraph 14 –Deposits held under different trusts should be treated separately)

Item 3 – Relevant deposits held in client accounts

1. Report in this item the amount of relevant deposits held by a depositor in a client account[2] for a client.

1. Relevant deposits held by a depositor in a client account for a client should be treated as separate from any other relevant deposits held by the depositor or the underlying client in his own right. The amount of relevant deposits held by a depositor in a client account that exceeds $100,000 should be excluded.

1. A deposit held by a depositor in a client account for a client who is an excluded person, need not be excluded from the calculation of the amount of relevant deposits. This means that Scheme members are not required to look beyond the depositor to identify the underlying clients so as to determine whether a client is an excluded person or not.

1. The following examples illustrate how the above reporting principles operate.

Examples of treatment of deposits held in client accounts

Depositor /

Details

/ Balance
($) / Amount of
Relevant Deposits
($)
ABC Brokerage Firm (deposit held in its own right) / Savings Account / 80,000 / 80,000**
Mr. L / Savings Account / 60,000 / 60,000**
ABC Brokerage Firm (held for its clients, including Mr. L) / Time Deposits / 150,000 / 100,000
(Paragraph 17 - Deposits held in the client account should be treated as separate from the deposits owned by ABC Brokerage Firm or the underlying clients in their own rights)
ABC Brokerage Firm (held for its clients, including Mr. M who is an excluded person) / Time Deposits / 160,000 / 100,000
(Paragraph 18 -Need not identify the underlying clients of the account)

** These deposits are held by the depositors in their own right and should be reported under item 1 of the return.

Part II – Other Information

Number of deposit accounts

1. Report in item II(1) the total number of deposit accounts maintained with your bank.

1. An all-in-one account made up of various sub-accounts such as current, savings and time deposit should be regarded as one account. Similarly, a time deposit account with multiple deposits should be reported as one account only.

1. Report in sub-item II(1)(i) the number of trust and bare trust accounts and in sub-item II(1)(ii) the number of client accounts.

Number of depositors

1. Report in item II(2) an estimate of the total number of depositors of your bank.

Hong Kong Deposit Protection Board

February 2005

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[1]Please refer to section 2 of the DPS Ordinance for definitions of “trustee” and “bare trustee”.

[2]Please refer to section 2 of the DPS Ordinance for definition of “client account”.