The development of Basel II has entered the implementation phase, Monetary Authority Deputy Chief Executive Willliam Ryback says, adding the new standards, effective on January 1, will benefit Hong Kong's banking industry and businesses.

Lawmakers have completed the negative vetting of the Banking (Capital) and Banking (Disclosure) Rules - the subsidiary laws prescribing how the capital-adequacy ratio of locally incorporated authorised institutions should be calculated and what information on the state of affairs, profit and loss and capital-adequacy ratio should be publicly disclosed by authorised institutions.

Two resolutions containing minor refinements to the rules were gazetted today. The resolutions, available here, seek to improve the rules' clarity, by introducing or revising definitions of certain terms, and achieve consistency in the terminology used in the rules. The revised rules will come into operation on January 1.

"It is very satisfying that all of the necessary legislation to allow Basel II to be implemented in Hong Kong is now in place. Driving the development of Basel II has been the belief that it will benefit the banking industry and benefit business in Hong Kong. As we now move into the implementation phase, our focus will be on ensuring that these benefits are realised," Mr Ryback said.