SFC identifies 600 funds for cross-border scheme
Securities watchdog identifies Hong Kong and mainland participants for cross-border mutual recognition scheme ready to be launched soon
The securities regulator has identified about 600 Hong Kong and mainland funds for participation in the soon-to-be launched mutual recognition scheme allowing cross-border fund sales, according to outgoing Securities and Futures Commission deputy chief executive Alexa Lam Cheung Cheuk-wah.
Lam told the South China Morning Post yesterday that among the 300 Hong Kong-domiciled funds, only about 100 were qualified, while there were about 500 mainland-domiciled funds that would be allowed to trade in the city. This is because no hedge funds or derivatives funds can be sold under this scheme, only simple bond and equities issues.
"There will be a quota arrangement as the mainland still has capital controls, but the way to calculate the quotas will be flexible," she said.
Lam said there would be a total quota for the whole scheme and each fund would have individual quotas that would be calculated based on a certain percentage of assets under management by a Hong Kong fund allowed to be sold on the mainland.
The same method would be applied to calculate the quota for mainland funds allowed to be sold in the city, she said.
No new fund launched can be cross sold under the scheme, only existing funds with qualified track records.