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SFC

SFC

Broker, fund manager numbers hit record amid Hong Kong stock market rally

SFC says the number of brokers, fund managers and financial advisers hit 43,976 at the end of September, as the benchmark index rose 32 per cent in the first 9 months

PUBLISHED : Wednesday, 06 December, 2017, 8:09pm
UPDATED : Wednesday, 06 December, 2017, 11:08pm

The Hang Seng Index’s 32 per cent rise in the first nine months of the year, where daily market turnover hit HK$100 billion (US$12.8 billion), has drawn a record number of people and companies to join Hong Kong’s financial industry, according to data from the Securities and Futures Commission.

The number of individuals working as brokers, fund managers or financial advisers hit a record high of 43,976 at the end of September, up 3.3 per cent from the year-earlier period, the local securities regulator said on Wednesday.

Likewise, the number of licensed companies rose 12.7 per cent to 2,613 in the nine-month period.

The Hang Seng Index has so far risen almost 28.3 per cent, with monthly average turnover at around HK$87 billion.

“The stock market rally and the rising market turnover have brought in better incomes for the brokers. In addition, there is an increasing number of mainland investors buying into Hong Kong securities companies. These all added to the increased number of people and companies working in the securities industry,” said Gary Cheung Wai-kwok, chairman of the Hong Kong Securities Association.

Average daily turnover rose 21 per cent to HK$82 billion in the first night months this year.

Cheung said the Hong Kong stock exchange’s move to close its trading hall in October would not affect the number of brokers or traders in the market.

“The closure of the trading hall only reflected the change of trading method – to go electronic. The brokers and fund companies still need to hire people to carry out trades for customers and to provide in-depth research for investors. The SFC’s record figures showed there is good prospect for youngsters to join the securities industry,” he said.

The SFC’s record figures showed there is good prospect for youngsters to join the securities industry
Gary Cheung, Hong Kong Securities Association

The stock and bond connect and mutual fund recognition schemes, as well as the Belt and Road Initiative that resulted in the increase in cross-border trading activities, would continue to boost the industry’s expansion in the next few years, Cheung said.

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On the flip side, the increased market turnover and rally have also triggered more investigations by the SFC during the July to September quarter. The regulator said it conducted 80 risk-based, on-site inspections of licensed firms to ensure they were compliant to the rules and regulation.

It made 2,300 requests for trading and account records from intermediaries, following its surveillance of untoward price and turnover movements.

The regulator also reviewed in the July-September quarter a record 110 new listing applications, a 27.9 per cent rise from the previous quarter, and objected to two of the applications.

The rising market turnover has boosted SFC’s quarterly levy income to HK$356 million, a 35 per cent rise from a year earlier.

This in turn helped the commission report a surplus of HK$26 million, turning around a HK$50.58 million loss from the year-earlier quarter.

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