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Financial Secretary John Tsang has urged investors to exercise prudence after the Hang Seng Index plunged to 21,134 today, down 1,075 points on the previous close.
Shares took a tumble in worldwide markets after the Dubai government announced its sovereign investment company, Dubai World and its affiliate Nakheel, will ask its creditors to delay repayment on billions of US dollars of debt for six months to enable the company to restructure.
Speaking to reporters this evening, Mr Tsang expected continuous volatility in the stock markets, adding the Government will monitor the situation closely.
"The Hong Kong banking sector's total exposure to the United Arab Emirates amounted to less than 0.4% of the sector's total assets. The financial problems of Dubai World should not pose serious risk to the Hong Kong banking sector."
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