Hong Kong Regulations

BANKING (CAPITAL) RULES - SECT 40

Provisions supplementary to section 38(e)

(1) An authorized institution's profit or loss falling within section 38(e) as
at a particular date shall be net of dividends—

   (a)  which are proposed or declared by the institution after that date; and

   (b)  which, as at that date, are recognized, or are required to be
        recognized, as equity on the institution's balance sheet.

(2) An authorized institution may, with the prior consent of the Monetary
Authority, include in its profit or loss falling within section  38 (e) any
unrealized fair value gains arising from the institution's holdings of
equities and debt securities designated at fair value through profit or loss
in its profit or loss account.