E-platform for bond trading may be in the works

The government will explore setting up an electronic platform for bond trading to broaden the investor base and continue to issue inflation-linked silver and green bonds.

It is looking to issue no less than HK$15 billion of inflation-linked retail bonds, also known as iBonds, no less than HK$35 billion of silver bonds and no less than HK$10 billion of retail green bonds in the coming financial year.

The first batch of retail green bonds, worth up to HK$6 million, was announced last week, with subscription from March 1 to March 11, and Paul Chan said a total of US$4.5 billion (HK$35.1 billion) of these bonds will be issued in the next financial year.

In addition to an electronic bond platform, the Central Moneymarkets Unit will also be enhanced by upgrading it to become a major central securities depository platform in Asia.

Chan said a feasibility study had been completed on allowing Hong Kong Stock Connect southbound trading stocks to be denominated in yuan, adding that mutual access to exchange-traded funds between the mainland and Hong Kong is expected to be implemented soon.

To increase the liquidity of yuan-denominated stocks supporting measures will be rolled out, such as the waiving of stamp duties on stock transfers paid by market makers.

At the end of last year, Hong Kong and mainland exchanges have reached a consensus on the inclusion of ETFs in the mutual market access program.

Last year, Hong Kong's stock market saw average daily turnover increase by 29 percent to HK$166.7 billion.

A total of 70 firms with weighted voting rights, a structure that enables founders or managers to own shares with greater voting power, were listed in Hong Kong as of the end of last month.

Those firms have raised more than HK$570 billion - nearly half of the total funds raised during the same period.

Hong Kong, however, dropped out of the top three listing venues globally last year, and the Securities and Futures Commission and Hong Kong Exchanges and Clearing said yesterday they aimed to ease listing rules for large tech firms.

This came as more new financial products, including a US$450 million infrastructure financing securities issued by Hong Kong Mortgage Corp, will be launched to diversify the local market.

Chan said HK$5 billion will be used to set up a Greater Bay Area Investment Fund, while HK$135 million will be given to the Trade Development Council over the next three years with the aim to help Hong Kong businesses explore opportunities in the mainland, especially in the GBA.