Factbox: Major finance milestones as Hong Kong marks 25 years since handover

A general perspective of Two Global Finance Centre (IFC), HSBC headquarters and Bank of China in Hong Kong, China July 13, 2021. REUTERS/Tyrone Siu/File Image

HONG KONG, June 28 (Reuters) – Hong Kong returned to China in 1997 just after 156 yrs of British colonial rule. In this article are some major milestones for the city’s fiscal marketplaces:

HONG KONG Dollar Trading BAND

The Hong Kong greenback was pegged to the U.S. greenback on Oct 17, 1983, with a investing band of amongst 7.75 and 7.85 per US greenback imposed since 2005. The Hong Kong Monetary Authority (HKMA), the city’s de-facto central bank, often enters the sector to obtain or sell the forex to maintain it inside of the band.

Twin HONG KONG AND MAINLAND LISTINGS

Industrial and Industrial Lender of China (601398.SS) became the very first organization to execute an IPO simultaneously in Shanghai and Hong Kong in 2006 when it issued A-shares and H-shares to raise US$21.9 billion, the biggest offer in the world at the time.

Stock, BOND AND Wealth Hook up

Shanghai-Hong Kong Stock Connect was produced in 2014 to provide mutual obtain between the fairness marketplaces of Hong Kong and mainland China. Two a long time later, the programme was expanded to Hong Kong and Shenzhen Inventory Join, which permitted mainland traders entry to lesser providers in Hong Kong and intercontinental traders obtain to new financial state firms shown in Shenzhen. The hook up programmes now go over about 2000 stocks, in accordance to Hong Kong’s Securities and Futures Fee (SFC). In May perhaps, China’s securities regulator agreed to include exchange-traded cash (ETFs) in inventory join programmes with Hong Kong.

In 2017, Bond Hook up was released to replicate the equity schemes and allow international investors to devote by way of Hong Kong in China’s multi-trillion bond marketplace. The Northbound Bond Link has turn out to be a major channel for overseas traders seeking entry to China’s bond industry. In September last year, China mentioned it would permit its buyers to trade offshore debt with the opening of the “Southbound” leg of its Bond Connect channel.

Prosperity Administration Hook up launched in September 2021, linking China’s southern province of Guangdong with Hong Kong and Macau, to permit cross-border resources management. The programme permits inhabitants of Hong Kong and Macau to obtain mainland financial commitment goods marketed by banking companies in the Greater Bay Location, although enabling inhabitants of nine Guangdong metropolitan areas to purchase people bought by financial institutions in the two offshore centres. read through a lot more

WEIGHTED VOTING Legal rights

Hong Kong Stock Exchange declared in 2018 it would allow for firms with twin-course shares – or weighted voting legal rights – if they are regarded as to be “revolutionary”, in a transfer built to facilitate listings from emerging small business sectors. The final decision was explained by the law organization Skadden as the most considerable transform to Hong Kong’s listing policies in 20 decades.

WAVE OF SECONDARY LISTINGS

The weighted voting rights variations in 2018 prompted a wave of secondary – or homecoming listings – which kicked off with Alibaba Team in November 2019. The Jack Ma-founded e-commerce giant raised $12.9 billion in the deal that was the premier share sale in Hong Kong at the time for 9 years. Considering the fact that then, 18 businesses have elevated $42.3 billion, in accordance to Refintiv facts. The pace of homecoming listings has remained potent as Chinese companies buying and selling in New York prepare contingency plans as U.S authorities push forward with delisting firms that don’t satisfy regulators’ auditing necessities. read far more

FUTURES

HKEX released its MSCI A-share index futures merchandise in 2021, an attempt to meet desire from buyers in Chinese stocks for hedging resources at a time of surging volatility.

Specific Purpose ACQUISITION Organizations (SPACs)

Hong Kong Inventory Trade permitted Special Purpose Acquisition Organizations (SPACs), identified also as blank cheque organizations, to get started investing from January 1, 2022, in line with most other major marketplaces in the globe.

Even so, restricted restrictions on the kind of traders which could acquire into the SPACs and banning retail participation dented demand for the products and solutions along with the present-day bout of industry volatility.

Only two SPACs have detailed due to the fact the start out of the yr. read additional

Reporting by Scott Murdoch Modifying by Anne Marie Roantree and Gerry Doyle

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