Goldman Sachs: The cooperation between the central bank and the Hong Kong Monetary Authority in promoting 11 financial connectivity measures is positive for the banking sector in Hong Kong.

Goldman Sachs released a research report stating that BOC HONG KONG, Standard Chartered Bank (02888), and HSBC HOLDINGS (00005) are all given a "buy" rating, while BANK OF EAST ASIA (00023) is given a "sell" rating. The report pointed out that on July 7, the People's Bank of China, together with the Hong Kong Monetary Authority and the Securities Regulatory Commission, announced 11 new measures to deepen financial cooperation between Hong Kong and the mainland. Six of the measures focus on supporting Hong Kong's fixed income and currency markets, while the remaining five aim to further develop Hong Kong's offshore RMB business, including increasing the total quota for RMB business funds from 200 billion RMB to 500 billion RMB. The bank believes that these measures will have a positive structural impact on Hong Kong banks overall, supporting the growth of RMB-related assets and liabilities. Goldman Sachs points out that as the only RMB clearing bank in Hong Kong, BOC HONG KONG (02388) is expected to be a major beneficiary in the short term. The measures will support an increase in RMB clearing and settlement activities, and provide BOC HONG KONG with potential fee income growth. In addition, Goldman Sachs believes that the series of new measures will also help alleviate investors' concerns about recent developments in mainland cross-border regulation, reflecting policymakers' continued commitment to developing Hong Kong as a leading offshore RMB center.