Clearing allows direct accounts
Hongkong Clearing will start its pilot scheme allowing investors to hold direct accounts at the Central Clearing and Settlement System (CCASS) for up to 5,000 account-holders on May 8.
Investors will be charged $200 a month for the service, which allows them to maintain accounts at CCASS rather than have their shares held by their broker.
The new system allows investors greater control of their share movements and provides enhanced legal protection of their holdings.
Presently, only brokers or custodians can open an account in the CCASS, but the collapse of several brokerages in 1996 sparked the need to change the existing system.
The failures revealed clients' shares could be frozen in the system and made it difficult to ascertain if a broker had been illegally trading clients' shares on his or her own account.
