HKEX’s new digital platform will speed up IPO process when it is introduced next year

The new platform – Fast Interface for New Issuance (FINI) – will shorten the IPO process from pricing to listing to two days from five currently

While brokers fear their margin lending income would be hurt by the new move, accountants and lawyers say it would bolster HKEX’s reputation

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Bourse operator Hong Kong Exchanges and Clearing is introducing a new digital platform to speed up the IPO listing process. Photo: Sam Tsang

Published: 7:47pm, 6 Jul 2021Updated: 7:48pm, 6 Jul 2021

Hong Kong stock exchange will introduce a new settlement process by the fourth quarter next year at the earliest to speed up the IPO process, the latest effort to reclaim its crown as the world’s largest hub for new listings.

The digital platform – Fast Interface for New Issuance (FINI) – will replace the current time-consuming paper subscriptions that would cut the initial public offering process from pricing to listing – from five business days to two, Hong Kong Exchanges and Clearing, the operator of the world’s third largest stock market, said on Tuesday.

The move will bring the city’s IPO settlement cycle in line with its counterparts in the United States and Europe. It was initiated following a consultation process last November, with 90 per cent of the respondents supporting the roll-out of the new platform, the exchange said.

“The introduction of FINI will shorten the cycle between IPO pricing and the start of trading, driving market efficiency and reinforcing Hong Kong’s position as the world’s premier IPO market,” said Nicolas Aguzin, chief executive of HKEX.

HKEX chief executive Nicolas Aguzin. Photo: Handout

It is the HKEX’s latest effort to promote IPOs. In 2018 it undertook a major reform that allowed companies with multiple voting rights and pre-revenue biotechnology firms to list here. The HKEX, which has been ranked the world’s largest IPO market seven times in the past 12 years, was third in the first half behind New York Stock Exchange and Nasdaq.

“This initiative is likely to attract more investors to participate in IPOs and hopefully make Hong Kong an even more attractive IPO market,” said Dennis Chow Chi-in, chairman of Deloitte China.

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