Hong Kong raised HK$388 billion through initial public offerings and HK$570 billion through post-listing fundraising in the first nine months of the year, Financial Secretary Paul Chan said at an investor session during the Global Financial Leaders' Investment Summit.
About 60% of companies newly listed in Hong Kong during the period had international business, Chan said. Many had stated in their prospectuses that they would use the funds to expand overseas.
Chan argued that businesses need different kinds of funding as they grow. Start-ups need investors willing to take risks with equity; later, companies may need more capital and industry partners. Those with stable cash flow can turn to credit and bond markets, while a stock-market listing can raise funds and give early investors a way to exit. He said Hong Kong aimed to connect businesses with capital throughout that development.
The Hong Kong Monetary Authority has increased its renminbi liquidity facility to RMB500 billion and extended its maximum term to three years, Chan said. Renminbi lending in Hong Kong had exceeded RMB1 trillion by the end of August. Five-year Chinese government bond futures, launched in August, together with Bond Connect and Swap Connect, offer investors more tools to manage interest-rate risk.
The Hong Kong Monetary Authority and Hong Kong Stock Exchange are building a central securities depository platform, Chan said. Separately, the exchange's futures and options clearing house has begun accepting eligible Chinese government and policy-bank bonds as non-cash collateral. Chan said the arrangement was intended to improve asset use and market liquidity.