Hong Kong Exchanges and Clearing Limited (HKEX) has had a very busy year; early in 2019, we launched our new three-year strategic plan, focused on three pillars: China Anchored, Globally Connected and Technology Empowered. Over the year, we have begun to deliver against this plan, with an expanded suite of product offerings across asset classes, key market microstructure enhancements, record volumes for our Stock and Bond Connect platforms, and a number of other initiatives to further diversify, build and grow our business.
HKEX this year, again, looks set to top the world’s IPO fundraising league table – the sixth time in the last 10 years. Since September, the listing market has been particularly buoyant, with the fourth quarter poised to become the busiest ever by the number of IPOs. HKEX also welcomed several of the world’s biggest listings in 2019, including both new economy and traditional organisations, underscoring the strong appeal of Hong Kong’s markets for global and regional issuers alike.
During the year, HKEX’s business continued to perform well, delivering record January-September revenues, all set against a challenging global political and macroeconomic backdrop. Solid contributions from our Post-Trade, commodities and technology businesses contributed to the good results.
On the regulatory front, HKEX implemented a number of Listing Rule amendments that have further strengthened the long-term health, quality and sustainability of the Hong Kong markets. We were also pleased to announce significant enhancements to the ESG governance and disclosure framework for Hong Kong-listed companies. This reflects our belief that ESG considerations are fundamental for business success.
Looking to 2020, HKEX remains focused on successfully executing upon its strategic plan to capture further growth opportunities in the region and beyond, helping realise its vision to be the ‘Global Markets Leader in the Asian Time Zone’.
HKEX would like to express its thanks and appreciation to all its customers, partners and other stakeholders for their support and dedication in enhancing the vitality, resilience and competitiveness of Hong Kong’s markets. We look forward to working with you in 2020.
Here is a look back at some of the year’s highlights:
Financial, Corporate & Strategic Highlights
- Launched Strategic Plan 2019-2021 under three pillars: China Anchored, Globally Connected and Technology Empowered
- Set up International Advisory Council, comprising international experts advising HKEX Board of Directors
- Record revenues reported in Jan-Sept 2019, of $12,565 million, up 2 per cent
- Jan-Sept 2019 EBITDA $9,663 million, up 3 per cent
- Launch of HKEX Values, a shared set of expectations and attributes for employees: Integrity; Diversity; Excellence; Collaboration; and Engagement
- Launched a refreshed CSR Programme across the Group, reflecting our purpose to ‘Progress our markets for the benefit of all’
- Celebrated Stock Connect’s 5th Anniversary, and 20 years of Exchange-Traded Funds (ETFs) in Hong Kong
Listing and IPOs
- Hong Kong on track to become world’s biggest IPO market, the sixth time in 10 years
- Listings under the new pre-revenue biotech chapter up by 9, to total of 14
- Amended Listing Rules on backdoor listings and shell activities, part of ongoing efforts to raise market quality
- New review structure for Listing Committee Decisions and appointment of inaugural Listing Review Committee
- Released consultation conclusions to amend the ESG Guide and related Listing Rules to improve issuers’ ESG governance and disclosure
Products and Markets
- New product types in Hong Kong markets: first listings of Two-time Inverse Products and Active ETFs; launch of Inline Warrants; Weekly Index Options; US Dollar London Metal Mini Futures; and Indian Rupee Currency Futures
- London Metal Exchange (LME) launched 7 new cash-settled futures, including hot-rolled coil, aluminium, alumina, cobalt and molybdenum
- Extension of After-Hours Trading Session to 3 am from 1 am
- Announced plans for enhancements on Pre-opening Session (POS) and Volatility Control Mechanism (VCM) in the Hong Kong securities market
- Expansion of Closing Auction Session (CAS) to cover all equities and funds
- Enhancements to Designated Specialist Programme for Exchange-Traded Products (ETPs)
- Announced plans for new spread table and continuous quoting market making obligations for ETPs and Leveraged and Inverse Products
- Eligible companies with Weighted Voting Rights added to Southbound Stock Connect
- Record Northbound Stock Connect trading volumes
- Inclusion of Bloomberg as a second trading platform for Bond Connect
- Another record year for Bond Connect volumes and number of registered users
Innovation and Technology
- Launched Client Connect, a key component of the Next Generation Post Trade Programme
- Innovation Lab continues work to deploy new technologies to apply to core business functions
- Acquisition of majority stake in Mainland technology firm BayConnect (formerly known as Ronghui Tongjin)
- Entered consortium to develop virtual bank in Hong Kong (Fusion Bank)
- Signed letter of intent to invest in a Beijing-based data technology firm
Corporate Social Responsibility and ESG
- Selected as a constituent of the Dow Jones Sustainability Asia Pacific Index for 10th straight year
- Enhanced CSR and ESG corporate advocacy programme: signatories of United Nations Women Empowerment Principles; Taskforce for Climate Related Financial Disclosure; Belt & Road Green Investment Principle; IFE – Hong Kong Financial Literacy Charter; Hong Kong Racial & Diversity Inclusion Charter
- LME announced responsible sourcing requirements for all traded metals after formal consultation
Awards and Accolades
- Best Corporate Governance Gold Award by the Hong Kong Institute of Certified Public Accountants
- Partner of Corporate Giving Award by Hong Kong Community Chest
- RegTech Award for Big Data and Analytics by Regulation Asia, a renowned regional digital magazine
- Financial Education Champion Award by Investor and Financial Education Council
- Other award information available on the HKEX Group website
Market Statistics for the period 1 January to 12 December 2019 is now available.
Hong Kong Exchanges and Clearing Limited (HKEX) is one of the world’s major exchange groups, and operates a range of equity, commodity, fixed income and currency markets. HKEX is the world’s leading IPO market and as Hong Kong’s only securities and derivatives exchange and sole operator of its clearing houses, it is uniquely placed to offer regional and international investors access to Asia’s most vibrant markets.
HKEX is also the global leader in metals trading, through its wholly owned subsidiaries, The London Metal Exchange (LME) and LME Clear Limited. This commodity franchise was further enhanced with the launch of Qianhai Mercantile Exchange, in China, in 2018.
HKEX launched the pioneering Shanghai-Hong Kong Stock Connect programme in 2014, further expanded with the launch of Shenzhen Connect in 2016, and the launch of Bond Connect in 2017.