The Hong Kong Monetary Authority (HKMA) plans to simplify the city's three-tier banking system to a two-tier model by merging deposit-taking companies and restricted licence banks. Under this proposal, deposit-taking companies would integrate with the restricted licence bank tier over a five-year transition period, during which these companies are expected to upgrade. The existing requirements, including a minimum capital of HKD100m and a minimum deposit size of HKD500,000, would be maintained. Although this change may not be immediately noticeable to the public, it is aimed at enhancing the system’s efficiency and flexibility, according to HKMA Chief Executive Eddie Yue Wai-man. Public consultations on the proposal will continue until September 25.