Mainland China and Hong Kong Special Administrative Region have different currencies. The Hong Kong Dollar (HKD) has been in use since 1937, with the smallest unit being a cent. The conversion rate of HKD to USD is HKD1 equals US$ 0.127. Hundred cents make up a dollar and 10 cents is known as 1 ho. The largest denomination is the 1000 dollar banknote and the lowest is the 1 ho coin.
Earlier, when Hong Kong was established as a free trading port in 1841, there was no indigenous currency. British pounds, Chinese Wen coins, Mexican Reales and even Indian Rupees were used indiscriminately. The first regal coins for Hong Kong were minted in 1863 with the picture of the British monarch on the obverse. Since the foreign coins were still in circulation, there was some amount of fiscal loss. The Government started using Silver Trade dollars from Britain , the US and Japan . In 1935, the HKD was established.
Hong Kong Economy operates under a Currency Board System . It has the world's highest daily turnover in the Banking sector, in the Foreign Exchange market. The financial sector is very well developed and has very high capital mobility. With the permission of the Hong Kong Monetary Authority, the currency is issued by the three main banking institutions of Hong Kong – The Hong Kong and Shanghai Banking Corporation Limited (HSBC), The Bank of China Limited (BOC) and the Standard and Chartered Bank Limited.
The denominations of $10, $20, $50, $100, $500 and $1,000 are in circulation as Banknotes . From 1993, since the British handover, coins and currency notes marked with the Queen's portrait were officially phased out. The Bauhinia was adopted as the new emblem by the HKMA. The HSBC issued notes with the picture of major landmarks and emblems of the Lion on the reverse. The BOC Banknotes just have pictures of the landmarks. The Standard and Chartered issue notes have a picture of Hong Kong and pictures of mythical Chinese animals on the reverse.
The currency notes and coins have interesting colloquial Chinese names. Earlier Cents were referred to as Cinnabar and 5 dollar banknotes were called 'Big Cracker'. HKD10 dollar is known as 'Grass' or 'Green Crab' because of the green banknote. HKD100 is known as 'Golden Thread' or 'Red Back', once again a reference to the color. The HKD500 banknote is called 'the Bull', since previous notes had a Bull emblem. The HKD1000 dollar note is called the 'Golden Bull'. An amount of 10,000 dollars is known as either 'cracker' or 'skin'. 1 million dollars is called 'Ball'.
At present, HKMA issues HKD10 banknotes only. A special edition polymer Banknote with HKD10 denomination will be issued in the later half of 2007 to commemorate the British handover to China .
