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Money Moves

Raising industry standards

by Miranda Breding

Au King-lun, chartered financial analyst and chairman
Hong Kong Securities Institute
Photo: Johnson Poon

The heat generated by the mainland economy has increased demand for Hong Kong's financial capabilities. Au King-lun, chartered financial analyst and chairman, Hong Kong Securities Institute (HKSI), says, "Hedge funds have grown substantially; private banking is ballooning. Everyone wants a share of the growing mainland market and Hong Kong is ideally positioned for that."

Despite this, Hong Kong is facing a shortage of experienced financial practitioners as more new financial companies set up offices in the territory.

Currently most training within the field is dedicated to frontline practitioners but, Dr Au says, "We have overlooked administration, relying on apprenticeship-type training which is not adequate given that Hong Kong is becoming a premium financial centre."

HKSI is appointed by the Securities and Futures Commission to oversee most of the Licensing Examinations for Securities and Futures Intermediaries (LE) including the mandatory LE Paper One for finance professionals. Some 140,000 candidates have taken the exam since the introduction of LE in 2003. About half of them are LE Paper One candidates. The next big initiative for the institute is its upcoming investment administration qualification (IAQ) programme.

The IAQ, a practitioner-led programme for individuals working in or aspiring to work in the administration and operations area of banking and financial institutions, will debut in Hong Kong in August. In conjunction with the Securities and Investment Institute of the UK (SII), this three-unit programme culminates in a series of tests and, for successful candidates, an industry-recognised qualification. An exam-only option is also available.

Already recognised by the SII, holders of LE Paper One are further required to choose two more units of study that fit their needs. Many financial practitioners in Hong Kong are required to pass the LE Paper One, unless otherwise exempted. With this in mind, many practitioners are given a fast track to attain the professional status of IAQ. A sampling of specific topics includes asset servicing, exchange-traded derivatives administration and global operations.

Before the recent introduction of IAQ, HKSI offered an introductory financial administration programme. However, Dr Au notes that IAQ goes into greater depth and leads to formal qualification. "It is a well-structured quality assurance programme X a seal of quality and basic knowledge," he says.

Currently, a financial administrator's depth and dimensions of knowledge depends very much on job function and area. Through IAQ, the institute can help broaden financial administrators' exposure and set a benchmark for the financial industry in Hong Kong.

"The industry as a whole is suffering from very high staff turnover in the administration area. This can't go on forever. We need to provide proper training and recognition for the long-term well-being of the Hong Kong financial industry," Dr Au says.

Hong Kong is the second Asia Pacific city, after Singapore, to work with SII. HKSI has already briefed more than 22 financial firms on IAQ. "We are encouraged by the feedback we've received," Dr Au says.


Taken from Career Times 03 August 2007, p. A2

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