Private banks have been issuing their own banknotes since the early days of Hong Kong's settlement. The Oriental Bank Corporation released the first banknotes in 1845. Since 1935, the HSBC Group has been the main issuer of banknotes in Hong Kong.
In 2019, HSBC Group held 67.7% of the banknotes in circulation.The Bank of China, another important banknote issuer in Hong Kong, commenced operations in 1917.
Initially, the Bank of China printed banknotes in both Chinese and English. However, following China's Communist takeover in 1949, the Bank of China ceased issuing banknotes in Hong Kong.The Hong Kong Monetary Authority (HKMA) was created in 1974.
The HKMA is in charge of ensuring Hong Kong's monetary and banking stability. It is also the sole authority authorised to print Hong Kong Dollar banknotes. However, the HKMA does not print or distribute banknotes.
This is the duty of Hong Kong's three authorised note-issuing banks: HSBC, Standard Chartered Bank, and Bank of China (Hong Kong).The three authorised banks are required to keep a Hong Kong Dollar reserve with the HKMA. They must also have security measures in place to prevent their currencies from counterfeiting.