HONG KONG - Hong Kong's financial chief John Tsang warned Monday that the city stood a higher chance of slipping into recession next year as the global financial crisis deepens.

"I believe the storm is getting closer. It is inevitable that Hong Kong, as an international financial centre, will be affected," he told legislators in a meeting.

"Under the circumstances, I expect the risk of having an economic recession in Hong Kong next year is getting higher and higher," he said.

But Tsang said there was no need for the government to inject capital into the city's banks.

Asked if Hong Kong would follow moves by other nations to inject liquidity into the banking system, Tsang told broadcaster Cable TV: "Absolutely no need."

"Our banking system is very stable. Their reserves and capital are very sufficient. So, we are not the least bit worried about them," he said.