A major objective of the HKMA is to promote the safety and stability of the banking system through the regulation of banking and deposit-taking businesses and the supervision of authorized institutions. In 2006 the HKMA continued to improve its banking supervisory approach by using more benchmarking reviews to identify the best risk management and internal control practices for selected businesses of the banking industry. With increasing competition in the industry, particular attention was paid to the ability of AIs to properly manage the risks arising from aggressive pricing strategies for their residential mortgage business. Preparations were completed for the implementation of Basel II in January 2007.