The provisional liquidators of the Hong Kong subsidiary of MF Global, a U.S. futures brokerage which filed for bankruptcy protection on Oct. 31 after a disastrous bet on European debt, said Wednesday that a Hong Kong court has approved in the day an interim distribution of up to 500 million HK dollars (US$64 million) of clients money.

Patrick Cowley, a principal at KPMG in Hong Kong and one of the provisional liquidators, said provisional liquidators were working both to recover clients' funds and to reconcile clients' claims to those funds. The Hong Kong court accepted that an interim distribution is appropriate and will go a long way to relieving clients' financial distress, he said.

"Based on recoveries and information available to date, we expect ultimately to be able to return something in the region of 90 percent of client funds, possibly more if we can recover funds currently held by MF Global affiliates overseas," he said.

According to KPMG's statement, the total balance of clients' funds held by MF Global as of Oct. 28 this year was about 1.2 billion HK dollars, so the interim distribution represented about 40 percent of that sum.

Cowley said the provisional liquidators would be working to making payments to the majority of the clients in the coming two to four weeks.

MF Global's Hong Kong business is being wound down, with about 15 percent of the original 90 staff currently retained by the provisional liquidators to assist in the liquidation process, according to KPMG's statement.

Cowley, along with his two colleagues, was appointed as the provisional liquidators of MF Global on Nov. 2 this year.

Prior to its collapse, MF Global operated as a global broker of exchange-listed futures and options. It also provided execution and clearing services for over-the-counter derivative products as well as for non-derivative foreign exchange products and securities in the cash market. It operated in 12 countries and regions on more than 70 exchanges.

KPMG is a global network of professional firms providing audit, tax and advisory services.

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