The Securities and Futures Commission (SFC) marks its 35-year history as the guardian of Hong Kong's capital markets with today’s publication of its Annual Report 2023-24.

The Annual Report highlights various initiatives to promote the resilience and sustainable growth of Hong Kong's capital markets to cement its position as an international financial centre. It also lays out the SFC's roadmap to prepare the capital markets for future opportunities as well as challenges. 

The SFC's Chairman Mr Tim Lui said: “The achievements we made and valuable experience gained over the years will stand us in good stead to steer Hong Kong's capital markets. To this end, we remain steadfast in our commitment to ensuring market integrity and resilience in the face of emerging trends and new challenges at the local, regional and global levels.”

The SFC's Chief Executive Officer Ms Julia Leung said: “To remain a world-class regulator and lead Hong Kong’s capital markets to new heights in decades to come, the SFC must strengthen its dual role as protector and enabler, by staying agile and vigilant as well as harnessing new opportunities from sustainability and new technologies, without compromising investor protection.”

Advancing Hong Kong’s super-connector role has remained one of the SFC’s top initiatives. With the recent measures announced by the China Securities Regulatory Commission to support the city’s market developments, the SFC is making efforts with all parties to launch these measures, in order to deepen Mainland-Hong Kong mutual market access. It is also striving to connect with new markets to diversify the sources of the city’s capital and listings. Senior management’s first official visit to the Middle East earlier in June has paved the way for further regional market collaboration.

The flagship Stock Connect scheme, which celebrates its 10th anniversary, has recorded a 20-fold advance in average daily trading since 2014. ETF Connect has also spurred overall ETF market turnover since its mid-2022 launch, boosting ETFs’ share to 14% of Main Board turnover in the first quarter of 2024 from 5% in 2021. Through its debut year, Swap Connect, which strengthens the city’s role as an offshore risk management hub, has seen its overseas participants more than double and average daily turnover quadruple.

To lead financial market transformation via technology and scale up the Web3 ecosystem in Hong Kong, the SFC has authorised the city’s first tokenised retail gold product, as well as Asia's first batch of virtual asset (VA) spot ETFs for retail access. These ETFs have a total market capitalisation of more than US$300 million with orderly trading and decent daily turnover since their launch. The SFC has made sure investors are protected through wide-ranging safeguards to foster a resilient VA ecosystem.

Tremendous enforcement efforts have also been made to uphold market integrity. Following the SFC's investigation, individuals involved in a highly sophisticated market manipulation case were convicted in a landmark High Court jury trial in May. The criminal prosecution marks the first time that an offence under the Securities and Futures Ordinance has been tried at the Court of First Instance. Separately, a case against two suspected core members of a large-scale ramp and dump syndicate was transferred to the District Court following the SFC's investigation. This marks the first ramp and dump criminal prosecution at the District Court.

Internationally, the SFC actively participates in global standard-setting work through the International Organization of Securities Commissions (IOSCO). In May, Ms Leung began her two-year tenure as Chair of the IOSCO Asia-Pacific Regional Committee to help ensure the Asian voice is heard globally. As a champion of sustainable finance, the SFC is working closely with the Stock Exchange of Hong Kong on taking a proportionate local approach to implement the IFRS Sustainability Disclosure Standards, to help the city become an early adopter of global standards and ride on transition finance opportunities. To lead by example and encourage transparent disclosure of carbon footprint by Hong Kong's corporates, the SFC also discloses its Scope 1-3 emissions for the first time in this annual report.

For the SFC's key operational data for the financial year of 2023-24, please refer to the Appendix of this press release.

The Annual Report, together with a video message, is now available on the SFC website, as well as its Facebook, LinkedIn and WeChat pages.

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