The long-anticipated mutual fund recognition scheme, which would allow Hong Kong-domiciled funds to be sold on the mainland and vice versa, has completed all preparatory processes and is awaiting final approval from mainland regulators, Securities and Futures Commission deputy chief executive Alexa Lam Cheung Cheuk-wah said yesterday.
"I believe the mainland watchdogs have recognised the importance of the scheme and I think they are waiting for the most appropriate time to announce the [start] of the scheme," Lam said.
Her comments come after China Securities Regulatory Commission chairman Xiao Gang told the Asia Financial Forum last month that mutual fund recognition would be the next important project to push forward after the Shanghai-Hong Kong Stock Connect scheme.
Lam, who will retire at the end of this month after serving with the securities watchdog since 1999, said Hong Kong would remain a reform testing centre for the mainland despite competition from other cities in offshore yuan business and the rapid opening of the mainland market.
The SFC and CSRC started discussing mutual recognition for fund products in 2012. Lam said last year the regulators were in the "final stretch" of talks.
Lam has said the first batch of funds to be allowed for sale on the mainland could be plain vanilla mutual fund products, such as equity and bond funds, while the second batch would include exchange-traded funds.