People’s Republic of China–Hong Kong Special Administrative Region: Financial Sector Assessment Program-Technical Note-Stress Testing the Banking Sector and Systemic Risk Analysis

Abstract

Hong Kong SAR (HKSAR) is a small and open economy, and a major international financial center with extensive linkages to Mainland China. Over the past two years, Hong Kong SAR’s economy and financial sector were adversely impacted by domestic social unrest, US-China tensions, and the global COVID-19 pandemic, resulting in an unprecedented two consecutive years of negative economic growth.