Hong Kong's banking community "must try harder" to adapt to challenges posed by new technology, said Norman Chan, chief executive of Hong Kong Monetary Authority.

Chan told delegates at a luncheon held by the Hong Kong Association of Banks and the Hong Kong Institute of Bankers that local lenders also need to improve ethical banking standards amid rapid technology developments. Chan added that banks also need to enhance staff training to stay competitive.

"We cannot enforce morality in banks … Banks will look for [regulatory] loopholes so it's banks' responsibility to ensure ethical approach," Chan said, during his last public speech as chief executive of the city's de facto central bank. He said, for instance, banks need to take fairness and transparency into account while collecting and using customers' data through systems powered by artificial intelligence.

Chan will retire on Oct. 1. Eddie Yue, deputy chief executive of HKMA, will take over the top post from Chan.

"[The HKMA] now collects data from more banks more frequently to identify emerging risks [in face of new technology]," said Chan.

The HKMA has granted eight virtual banking licenses, which is seen as Hong Kong's efforts to facilitate technology innovation for the financial industry.

The launch of these online-only banks is expected to be delayed to early 2020, from previous target of some time this year, amid ongoing protests in the city as well as other factors, Reuters reported earlier.