Chairman Statement

2002-2003

              “Credit” and “Collection” are probably two of the most widely heard words and concerned topics in Hong Kong in the last two years, not only among credit practitioners, credit providers, debt collection agencies and debtors but also throughout the general public, in all walks of life.  Slow payments, delinquencies and non-payment of debts are soaring and an average of more than 70 people filing their bankruptcy petitions every day.   

              The current economic climate is widely regarded as one of the worst that Hong Kong has ever experienced in the past ten years.  Personal bankruptcies soared 300 per cent a record 10,173 in the first six months of 2002.  The number of bankruptcy orders has risen by more than 10 times since 1998, when the total was 893.  A record of 25,328 people was declared bankrupt in 2002, more than a double of the previous year.  Credit card bad debt in the third quarter rose to an annualized 14.55 per cent, the highest on record. 

               The situation is believed to continue worsening in view of the soaring unemployment rate and bankruptcies coupled with prevailing economic downturn and property slump.  

               As the “Navigator”, the Association has been closely monitoring and reviewing the progress.  In the past year, the Association has conducted various surveys on proposals and laws and regulations affecting our industry such as LRC’s report on “The Regulation of Debt Collection Practices” published in July 2002 and the proposed “Sharing of Positive Consumer Credit Data’ to be launched later this year.  The Association has also responded to various related government bodies, such as the Law Reform Committee as well as the Privacy Commissioner on the controversial “Sharing Positive Consumer Credit Data”.  

               As always, HKCCMA’s staff and Executive Councilors have been continuing their invaluable support and contribution to the Association.   They are respectively serving on various committees from “Annual Award”, “Certification”, “Survey”, “Who’s Who”, to the recently appointed “Education”.  In parallel with our growth, the Association requires support of every member, especially your volunteered time and talent to serve your own association.  There are various existing and new committees, which need your expertise and voluntary involvement and the Chairs of the various committees will be in contact with you seeking for your participation.  HKCCMA is a members-built non-profit organization working for the credit & collection industry, which continuously requires input of professionals.  

                 I feel excited to visualize our association commencing the forth year of development and am pleased to announce our 3^rd year anniversary and report to each member of our Association’s achievements and works in the past year.

Executive Council

The nine-person Executive Council, continued leading the Association to the right track and direction through a balanced view and comments on every discussed topic and issue, is still composed of councillors from credit provider operations and credit collection agencies.

We are adamant on the continuous growth of our membership in view of the right direction that has been heading in the past three years.  After all, we are the Association for all the credit and collection practitioners who will sooner or later become part of it. 

Members Recruitment

The association currently has more than 65 members. Last year, we recruited 3 Corporate Members, 5 Fellow Members, 5 Members and 2 Associate Members.  Our membership base covers every commercial and business corners including banking and finance, telecommunication, law practice, shipping, manufacturing, trading, debt collection agencies, credit reporting agencies and nearly all the major credit insurance companies.

The Association’s Web Site 

The hit rate of our website has been increasing satisfactorily with more than 3,000 times a month from members and non-members users/visitors.  In addition to the hot sections such as News Forum, Credit Quiz, Write an Article and Discussion Groups; the Job Classified section has also received increasing responses and has been helping employers and job seekers to network.  In January 2003, the University of British Columbia contacted our association on “The Recruitment Day of UBC  (University of British Columbia), Canada held from February 16^th to 21^st.”, which has provided an opportunity to HKCCMA members (especially   corporate members), to casually meet the students (potential job seekers) while they were in Hong Kong.

The Discussion Group and Credit Quiz are again two of the hottest sections where members and non-members have either tendered their opinions on controversial topics or tested their credit & collection knowledge in “Credit Quiz” section.  Last year, over 30 enquiries were received from individuals, companies and associations from overseas.  The links to worldwide associations and news have been continuing to provide a wide exposure to our members and the general public, in the international credit and collection arena. 

 Surveys

 The Association has officially established a Survey Committee in conducting various surveys on matters and issues related to credit and collection industry.  Following is a list of surveys conducted in the past two years. 

January 2003:  “Which party is to be benefited most from "debt relief" program (the  “Individual Voluntary Arrangement”)?”

Nov 2002:  “The sharing of positive credit data among banks in Hong Kong”

August 2002:  “The regulation of debt collection practices reported by Law Reform Commission of Hong Kong in July 2002”

Jul 2002:  “Which organization is the ideal executive body for gathering and sharing the positive data of bank individual customer?”

Mar 2002: “What client data should be shared to reduce the loss of banks and financial institutes due to bankruptcy?”

Dec 2001:  “Is Credit Scoring applicable to all commercial credit operations?”

Oct 2001 “Which party within an organization is considered the most effective party for contacting the debtors for overdue accounts receivable?”

Aug 2001 “For bankrupts, what is the reasonable time before which an automatic discharge should be granted?”

Jun 2001 “What credit tools/process you would rely on mostly when making credit decision?”

Media 

As always, the Association has been regarded as the representative body with matters and issues related to credit and collection industry.  Last year the media and press interviewed the Association in a number of high profiled issues and controversial topics.  In Hong Kong, interviews with major newspapers and medias such as South China Morning Post and TVB News are continuing.   

These interviews were mostly related to the views and comments on various topics and possible legislations related to the credit and collection. In line with our mission to develop professionalism within the credit and collection industry; the Association will continue on expressing views, concerns and possible correction on any misconception or prejudice of our industry, to the public.

     In July 2002, South China Morning Post and TVB News interviewed Association’s Vice-Chairman Mr. Bobby Rozario, FCCMA, MCE on comment on the Law Reform Report. 

           Mr. Rozario expressed the Association’s worries that the proposal of creating a criminal offence of the harassment of debtors would affect collection agencies operation as such a law could lead to debtor’s abuse if not clearly defined.

           Mr. Rozario further expressed that the Association hopes to work out the details with the government through the proposed licensing authority, which the commission suggested could formulate the code of practice with the industry.

           In July 2002, the Association’s Chairman, Mr. Benedict Wong, FCCMA, MCE in an interview with TVB News, expressed the views on debt recovery from debtors in the disciplinary force, which has been reportedly ranked as the highest risk sector in consumer collection by the banks and finance companies. Mr. Wong further expressed that the Association was not aware of that “rank list” in labelling debtors.

HKCCMA’s views on the published report on “Regulations of Debt Collection Practices”

         On 29^th July 2002, The Law Reform Commission in Hong Kong finally released its report on “The regulation of debt collection practices”.  The aim of the report was to review the adequacy of the existing law that governs the way in which creditors, debt collection agencies and debt collectors collect debts in Hong Kong outside the court system, and to recommend such changes in the law as may be thought appropriate.

        HKCCMA supports the licensing but has some concerns on the recommendations. The Association has been expressing, since LRC’s initial proposals in September 1999, the concerns over the possible abuse by debtors and the difficulties for police to enforce in view of the vague definition.     

        To the collection industry as a whole, the LRC’s recommendations (other than the controversial portions) will mean a mechanism in driving every industry practitioner to the highest professional standard where only those qualified and dedicated will survive.   This will be beneficial to the industry in the long run.

Certification

             In July 2002, HKCCMA signed the Sponsorship Agreement (SA) for Hong Kong and China region on the Certification Program with ACA International (formerly known as American Collectors Association).  The SA was officially handed from Nancy Borgen (President of ACA International) and Gary Rippentrop (CEO of ACA International) to our Chairman Mr. Benedict Wong, FCCMA, MCE during the Orlando ACA Convention.

             The signing of the Sponsorship Agreement on The Society of Certified Credit & Collection Professionals (SCCCP) certification program marks the official launching of the never-before certification program in Hong Kong and China which will provide an opportunity to acquire industry recognition for credit and collection professionals at various stages of their achievement in the career.

             The SCCCP certification program has its origin from The Society of Certified Credit Executives. SCCCP has grown from the roots of two prestigious, long-standing industry programs: ACA's Collector Certification Program and SCCE Program, the original certifying branch of the former International Credit Association. The Collector Certification Program has been in existence since 1986. The SCCE was formed in 1960. To date, more than 5,000 individuals have been certified through these programs.

             SCCCP represents individuals from all walks of the credit & collection industry. It offers an opportunity for recognition above and beyond what either program could do individually. To achieve certification designations, individuals must demonstrate their knowledge and expertise in specific skill areas by meeting specific requirements. These requirements may include such components as industry experience/tenure, education and contributions to the industry and/or testing. Certificate programs include career path opportunities in both credit granting and collections.

             Originally instituted in 1960, by the original SCCE, ACA's Credit Law & Practices Series recognizes individuals who demonstrate skills in effective credit management and who contribute to the industry as a whole. Individuals who wish to position themselves and their companies for growth in the industry all benefit from the program. Individuals who successfully complete requirements of the specific certification offerings earn designations from the Society of Certified Credit & Collection Professionals. The Credit Law and Practices Series are currently in a state of review and transition. Offerings in the Credit Law & Practices Certification Series will include: -

 -Level I: Entry Level

Certified Credit Associate (CCA)

 -Level II: Management

Certified Credit Executive (CCE)

 -Level IIA: Specialization

Certified Credit Bureau Executive (CCBE)

Certified Consumer Credit Executive (CCCE)

Certified Financial Counseling Executive (CFCE)

Certified Credit Executive - Hong Kong (CCE-HK)

 Level III: Executive

Master Credit Executive (MCE)

             The official launching of SCCCP has been delayed due to the re-organization of its governance, materials and requirements.  SCCCP is now under the Educational Council of ACA International.    The ACA Educational Council is reviewing different levels of certification and will update our association upon any progress and finalization of the requirements. 

             HKCCMA is expecting to have full materials and related requirements ready for our members some time this year.   More information on the program will be released in our association’s website www.hkccma.com. Members can alternatively email their enquiries to SCCCP, Hong Kong at scccp@hkccma.com.

The “Positive Credit Bureau” (PCB)

In May 2002, Hong Kong banks invited public to comment on their controversial drive to share more customer credit information with each other.  Soaring bankruptcies and unpaid credit-card bills have prompted banks’ plan to pool additional information such as number of credit cards a customer already has - together with credit limits and payment records, as well as outstanding unsecured personal loans and loan repayment history.

The original views on establishing the PCB are fairly balanced with banks in Hong Kong and The Hong Kong Monetary Association (HKMA) supporting its establishment before the end of the year while the consumers, union lobbyists and the Privacy Commissioner firing from the other side.

The Association responded to the public consultation on PCB upon the release of the consultation paper and details of our response could be found at the association’s website. 

On 23 January 2003, The Privacy Commissioner for Personal Data, Mr Raymond Tang, released the report on the public consultation on a set of proposed provisions on consumer credit data protection in relation to the financial industry's proposal on the sharing of positive credit data.    

 The consultation results reflect a broad public consensus that the rising trend in personal bankruptcy and consumer debt is a matter of major concern to the community.  If not effectively addressed the bankruptcy problems may lead to a loss of consumer confidence in the market and the economy as a whole.

The Association supports the establishing of PCB, which is in line with our Mission “To strive for the preservation of a healthy credit environment in our society”.  As long as access to the data is reasonably regulated, the Association believes the PCB would be able to reduce the amount of fraud and allow banks to make more sensible credit decisions.  The sharing of positive data through PCB would also help young and inexperienced credit seekers manage their credit spending correctly and appropriately, such as in parallel with their income resources, thus controlling, and hopefully decreasing the number of bankruptcies and possible tragedies.

“Mix At Six”

            The Association launched the quarterly “Mix At Six” function since middle last year, which was designed to provide a venue for members, non-members and guests to mix and mingle and to know more about our association, the Councillors and various committee members.  In view of the overwhelming response the Association has decided to hold the function on a bi-monthly basis.  I would like to encourage every member and non-member to join us at this meaningful and casual “Mix At Six” function, which provides great opportunity to mingle, chat and exchange.

Credit Practitioner of the Year 2002

The Association congratulates Mr. Bendix S. W. Cheng, MCCMA, Group Credit Manager of Fountain Set (Holdings) Ltd, who was named “Credit Practitioner of the Year 2002”.

The Award is to recognize the winner's works relatively with credit & collection in the aspects of education, training, management, operation and customer service in year 2002.  Our five-person Judge Panel, Mr. Neil Wood, Director of the International Unit of ACA International; Mr. William Lee, Professor of the Department of Accountancy of The Hong Kong Polytechnic University; Mr. Daniel Lau, General Manager of Gerling General Asia Ltd; Mr. Benedict Wong, FCCMA, MCE, Chairman of HKCCMA and Mr. Michael Haynes, Managing Director of Hermes Credit Underwriters Hong Kong Limited, has found Mr. Cheng to be the practitioner who has continuously demonstrated the said qualities in the designated areas in year 2002.

The Award Presentation Ceremony will be held in the upcoming Annual General Meeting. This is a yearly award where the nomination procedures and criteria for Credit Practitioner of Year 2003 will be available at the Association’s website at a later stage. 

On behalf of Association, I would like to express our gratitude to all the members of the Judge Panel, especially to Mr. Neil Wood, Professor William Lee, Mike Haynes and Daniel Lau.  Their support in serving in the panel is indispensable to the launching and future development of this award program.

ACA International Member of the Year Award

In July 2002, the Association’s  Chairman, Mr. Benedict Wong, FCCMA, MCE was once again awarded Highest Honor from an international trade association.

Mr. Wong was awarded the “ACA International Member of the Year Award ”, formerly known as the “Paul Bunyan Award” at ACA International’s 63rd Annual Convention & Exposition in Orlando, Florida, held in July last year. ACA’s highest honor, the International Member of the Year award is presented to the individual who, during the past year, is judged to have made the greatest contribution to ACA and the credit and collection industry.  This is the second time Mr. Wong was presented this award.  He was awarded “the International Paul Buynan Award” in year 2001.

 Mr. Wong was also re-elected as the Chairman and Asia/Pacific Director of the International unit of ACA international (The Association of Credit and Collection Professionals), the election took place on the International Member Business Meeting held on 19th July 2002.

The Association has grown and prospered because of people who care and offer their vision to address our changing environment.  These people serve as committee chairs and members, sharing ideas, knowledge and expertise.  I have been privileged to work with our staff Ms. Betty Huen, MCCMA, CCAE, Director of Communication and Mr. Eddie Chan, MCCMA, Director of Membership, of whom work tirelessly behind the scenes; with our excellent Executive Councillors Mr. Alan Lam, MCCMA, CCAE, Mr. Andrew Kwok, MCCMA, CCAE, Mr. Bobby Rozairo, FCCMA, MCE, Mr. Eagle Cheung, FCCMA, CCCE, Mr. Francis Lo, FCCMA, CCAE, Mr. Germany Heng, FCCMA, FCI, CCCE, Mr. Johnson Chong MCCMA, CCAE and Mr. Stephen Lo FCCMA, CCCE.  I thank each of them for their outstanding work. As an organization and an industry, we are fortunate to have individuals such as these who are willing to give their time and talent. 

As we have moved forward with care and concern and remained dedicated to a better for our members, I hope I have made meaningful contributions.  I sincerely thank you for the opportunity to serve as your Chairman this past year, for the support you have shown and the friendship you have shared.   

My thanks to the Association’s Advisory Team: ACA International; Mr. James Kun Sun To, Legislative Councillor and member of the Hong Kong Democratic Party; Mr. Gary Rippentrop, Chief Executive Officer of ACA International; Mr. Neil Wood, Director of the International Unit of ACA International; Mr. Victor C. Y. Chan, solicitor of Tang, Wong & Cheung and Mr. Benny K. Y. Chan, CPA and owner of Benny K. Y. Chan & Co. 

 It is a great honour to our Association to have Mr. K. K. Chung, CPA and the owner of KK Chung & Co and Cody Leung, Solicitor of Holman Fenwick & Willan who have joined our Advisory Team and respectively serve as our Honorary Accountant and Honorary Legal Adviser.   I would also like to personally thank again Mr. Benny Chan, our former Honorary Accountant, who has volunteered his time and professional advice to our Association since our establishment in late 1999.  

           To close this chairman statement, I wish all of you good health and good business.  Hong Kong is currently facing two critical challenges, the economic downturn and the recent SARS (a.k.a. atypical pneumonia).   On behalf of the Association, I express our greatest respect to all the frontline health-care workers who have tirelessly and endlessly devoted their care and effort to the general public, with some of them having been unfortunately infected.  I would like to take this opportunity to wish all those infected to recover the soonest.

Development Plan

  The Association is heading into its forth year of establishment.  The election result of the new Executive Council will be announced on the Annual General Meeting to be held on 25^th April 2003 at the Park Lane Hotel.  

  In line with the Association’s Mission “To preserve a healthy credit environment in our society “, the new EC team will continue expanding the membership base, launching the SCCCP certification and educational programs and lobbying the government and political parties and independent councillors on legislative and licensing issues related to our industry. The development plans for year 2003-2004 include: