On 14 Apr 2025, the HKMA endorsed the HKAB's new practice allowing banks to release estate funds without grant amendments for minor balance variations within defined thresholds, enhancing efficiency for beneficiaries and institutions while maintaining prudential oversight.
This article was generated using SAMS, an AI technology by Timothy Loh LLP.
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Background
On 14 Apr 2025, the Hong Kong Monetary Authority (HKMA) issued a circular supporting the Hong Kong Association of Banks' (HKAB) new practice for handling cash in bank accounts of deceased account holders, addressing inefficiencies in the existing process where minor balance variations necessitated grant amendments.
New Practice
The HKAB Guideline establishes a new practice enabling banks to release estate funds to grantees without amending grants for minor balance variations, subject to specific thresholds. For estates valued under HKD $1 million per bank, banks may release funds without grant amendments if the actual balance does not exceed the stated amount by more than HKD 10,000 or 110%. For estates valued at HKD $1 million or more per bank, banks may release funds without amendments if the actual balance does not exceed the stated amount by more than HKD 200,000 or 10%. Banks retain discretion to release funds where variations are traceable and reasonable, streamlining the process to reduce delays and costs for grantees, banks, and the Probate Registry.
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