HONG KONG, Jan. 26 -- Hong Kong Monetary Authority Monday announced that the Exchange Fund of Hong Kong recorded an investment income of 43.6 billion HK dollars (about 5.63 billion U. S. dollars) in 2014.

The figure comprises gains on Hong Kong equities, other equities, bonds and other investments, amounting to 96.3 billion HK dollars in total; and an exchange loss of 52.7 billion HK dollars.

The Abridged Balance Sheet shows that the total assets of the Exchange Fund increased by 119.3 billion HK dollars, from 3,032.8 billion HK dollars at the end of 2013 to 3,152.1 billion HK dollars at the end of 2014. The increase is mainly attributable to an increase in the balance of the banking system and placements received from the Hong Kong government funds and statutory bodies.

On the outlook for the coming year, Chief Executive of the Monetary Authority Norman Chan said the investment environment in 2015 will be even more complex and difficult than 2014. There is considerable uncertainty arising from the timing and pace of the US interest rate normalization, which is then complicated by the implementation of QQE by Japan and the launch of a full scale QE by the European Central Bank.

The recent sharp rise in the US dollars, big drop in oil prices and the market turbulence following the surprise move by the Swiss National Bank to drop the one way peg of the Swiss Franc against Euro were just some of the more notable manifestations of the market reaction to a very abnormal global financial and macroeconomic environment, Chan added.

"Faced with these challenges, we will continue to exercise prudence and discipline in managing the Exchange Fund in line with its investment objectives, which are to safeguard the principal and to provide abundant liquidity buffers to meet the Exchange Fund's statutory purposes as and when it is necessary," he said. ( 1 U.S. dollar equals 7.75 HK dollars)