| Abstract | The banking industry is undoubtedly going to face a number of challenges over the coming years and how well individual banks will be able to cope with these depends largely on the abilities of its management. To face the challenge of political transition for instance, the author suggests that banks have a responsibility to ensure high standards of capital adequacy, liquidity and prudence, so that no signs of serious weakness emerge which might cast doubts on the stability of the system. Increasing competition arising from the forces of globalization, deregulation and technological innovation will also be challenges facing the Hong Kong banking industry. It is possible that some banks may choose to get together to try to achieve economies of scale and in particular to share the costs of new technology. |
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