Yam leaves behind much to ponder

The retirement of Hong Kong monetary chief Joseph Yam this October should open the way for the separation of the authority's supervisory functions from the central bank.

Many financial experts have contended that the supervisory role should be entrusted to a government agency. This would allow the Monetary Authority (central bank) to stay above the secular concerns, which are the bureaucracy's prerogative; and, concentrate on the ecclesiastical duties of defending the Hong Kong dollar and promoting Hong Kong as an international financial center.

Yam, who has been chief executive since the Monetary Authority was set up in April 1993, is known to have scoffed at talks of the split. Indeed, the Monetary Authority was born of a merger of the Office of the Exchange Fund, which manages Hong Kong's reserves, with the Office of the Commissioner of Banking, a watchdog agency answering to the Finance Secretary.