The view of Hong Kong Photo: VCG

Eddie Yue, chief executive of the Hong Kong Monetary Authority (HKMA), on Sunday rejected claims that Hong Kong is now a "relic" of an international financial center, saying the city has the largest banking system among all the international financial centers in Asia.

Under the One Country, Two Systems principle, the unique status and advantages of the Hong Kong Special Administrative Region (HKSAR) remain intact and its position as a global financial hub is irreplaceable, experts said.

Speaking on a TV program, Yue said that Hong Kong's banking system is the largest among Asian international financial centers, and its stock market trading volume is also higher than in neighboring regions, Sing Tau Daily reported on Sunday.

Yue also said that there is no sign of outflows from the Hong Kong banking system. Hong Kong's banking sector performed well in the first half of this year, with profits increasing by 170 percent on a year-on-year basis. The growth was primarily driven by interest rate differentials, improved investment returns and foreign exchange gains, he said.

The Hong Kong banking sector remained resilient, underpinned by robust capital and liquidity positions, according to the Half-Yearly Report on Monetary and Financial Stability issued by the HKMA in September.

The aggregate pre-tax operating profit of retail banks increased by 120.5 percent year-on-year in the first half of 2023. The return on assets rose notably to 1.15 percent, according to the report.

Yue said that mutual market access programs between the Chinese mainland and Hong Kong will bring significant opportunities for Hong Kong's banking industry.

Hong Kong has weathered numerous world-class financial storms, proving its financial system's professionalism, neutrality and stability, and the advantages of Hong Kong as a financial center remain, Li Yong, a senior research fellow at the China Association of International Trade, told the Global Times on Sunday.

Hong Kong is strategically located in the heart of Asia's economic hub, backed by the world's second-largest economy. Moreover, it serves as the largest offshore yuan trading center, with advantages that cannot be easily replaced by other regions, Li said.

Hong Kong's offshore yuan liquidity pool has expanded with the total outstanding amount of yuan customer deposits and certificates of deposit increasing to 1.067 trillion yuan ($149 billion) as of the end of July 2023, according to the HKMA.

The unique position under the One Country, Two Systems principle enables Hong Kong to play a bridging and connecting role, becoming a platform for cooperation between Chinese mainland and international exchanges, further expanding its influence, Noel Shih, chairman of the Young Democratic Alliance for the Betterment and Progress of Hong Kong, told the Global Times.

"I have full confidence in the future development of Hong Kong. With its excellent rule of law, open market economy and abundant talent resources, Hong Kong's advantages will contribute to its continued status as an international financial center," Shih added.