Hong Kong’s capital markets made significant progress in deepening market connectivity while driving financial innovation and diversification, according to the Securities and Futures Commission’s (SFC) July-September 2025 Quarterly Report published today.
The city has continued to bolster its super-connector role through deeper connections with both overseas and Mainland markets. Globally, the SFC has signed a total of six memoranda of understanding so far this year, including three in the quarter, to reinforce asset management ties.
With product expansion in September, Swap Connect –– a Mainland-Hong Kong derivatives market connect scheme –– saw its trading volume grow 56% year-on-year (YoY) as of November; aggregate transactions exceeded RMB9.3 trillion since launch in 2023 (Note 1).
To drive market innovation, the SFC has been working closely with the HKSAR Government to issue conclusions on the two proposed regimes related to virtual assets (VAs) in the near future (Note 2).
On the new product front, SFC-authorised VA spot exchange-traded funds (ETFs) saw total market capitalisation rise 33% YoY to $5.47 billion as of end-November, with their total number increasing to 11. Tokenised retail money market funds (MMFs) authorised by the SFC recorded total assets under management (AUM) of $5.48 billion as of end-November, soaring 557% since the launch of the first such MMF this year. Their total number rose to eight.
To support Hong Kong’s further growth as a premier offshore renminbi hub, the SFC and Hong Kong Monetary Authority (HKMA) jointly issued a roadmap in September to position Hong Kong as a global fixed income and currency hub (Note 3). A detailed workplan is being developed to set out the next steps and key milestones for implementing the roadmap's initiatives.
“Our capital markets delivered another quarter of steady and diversified growth despite global headwinds and volatility,” said Ms Julia Leung, the SFC’s Chief Executive Officer. “To solidify Hong Kong’s status as an international financial centre, it is crucial that we continue to bolster the future readiness and resilience of our markets, underpinned by fit-for-purpose regulatory frameworks and robust investor protection.”
Other quarterly highlights (Note 4):
a) The 24 initial public offerings (IPOs) in the past quarter raised over $70 billion in total, which increased more than 70% from a year ago. Hong Kong continued its global lead in terms of IPO funds raised.
b) Hong Kong-domiciled funds maintained net inflows of $46.9 billion last quarter. Their AUM jumped 35.9% YoY to $2.27 trillion as of September. Moreover, SFC-authorised ETFs grew strongly by 31.8% YoY to $653.5 billion in total market capitalisation as of end-September, accounting for 13% of daily market turnover (Note 5).
c) Licence applications under the Securities and Futures Ordinance increased 12% YoY to 2,799. The numbers of SFC-licensed corporations and individuals grew 2.7% and 3.6% YoY to 3,379 and 46,457, respectively.
d) To caution Hong Kong investors against market volatility linked to the stablecoin concept, the SFC issued a joint statement with the HKMA in August.
e) The Stock Exchange of Hong Kong Limited (SEHK) took its first-ever disciplinary action against two former company directors for failing to cooperate in investigations jointly conducted by the SFC and SEHK.
f) In a new phase of its “Don’t be Sucker” anti-scam campaign, the SFC has extended its outreach to university students and the elderly to educate the public.
The Quarterly Report is available on the SFC website.
Notes:
- Under Swap Connect, OTC Clearing Hong Kong Limited began clearing northbound swaps referencing the Mainland’s one-year Loan Prime Rate in September.
- The Financial Services and the Treasury Bureau and the SFC conducted a joint consultation to introduce regulatory regimes for VA dealing and VA custodian service providers from June to August. See their joint press release dated 27 June 2025.
- See the SFC-HKMA joint press release on the “Roadmap for the Development of Fixed Income and Currency Markets” dated 25 September 2025.
- Unless otherwise specified, all figures are for the quarter ending September 2025 or as of end-September 2025.
- The figures here include leveraged and inverse products.
