Hong Kong Exchanges and Clearing (HKEX), which operates the third largest stock market in Asia, will open an office in London in the first half of this year to promote international listings and attract more overseas investors. The news confirms a report by the South China Morning Post in June last year that the bourse planned to open offices in London and New York. HKEX opened its New York office in December, which joined existing offices in Singapore, Beijing and Shanghai. The expansion to New York and London underscores HKEX’s search for diversification and growth, as well as its efforts to strengthen its role as a connector between China and international markets. “HKEX has strong ties with the financial community in London through the London Metal Exchange, and this new office will further strengthen our commitment to supporting the ambitions of our broad range of customers around the world,” HKEX CEO Nicolas Aguzin said in a statement on Thursday. HKEX bought the London Metal Exchange in 2012 as its first overseas acquisition. “Together with our newly opened New York office, our footprint will now cover all key global time zones, supporting us as we connect capital with opportunities and East with West,” he said. Aguzin told the Post in an exclusive interview in June that his dream was to “have multiple offices, not only in Europe, but also in the Middle East, and Latin America as well”. “The purpose is to make sure that Hong Kong is an international centre to attract investors from all over the world,” he said. International investors account for 41 per cent of Hong Kong’s stock-market turnover, while European investors represent 10 per cent of total turnover, according to HKEX data. However, only about 160 international firms are listed in Hong Kong, representing only about 6 per cent of total listings. In contrast, Hong Kong-listed firms from mainland China number more than 1,400, representing more than half of the total. “London is a natural choice for HKEX as it is an international financial centre with many potential listing candidates,” said Louis Tse Ming-kwong, managing director at Wealthy Securities. “Even after Brexit, London is still close to Europe, and the HKEX can use the London office to expand to the European market in the future.” HKEX posts best fourth quarter as post-Covid bounce fuels trading HKEX’s expansion comes at the right time, Tse said, as Hong Kong reconnected to the world after the end of its restrictive quarantine policies in September and the reopening of the border with the mainland in January. Beijing also favours the international push. The China Securities Regulatory Commission in December unveiled a plan to allow Hong Kong-listed international firms to be traded by mainland investors via the two Stock Connect schemes, which is expected to start within a few months. UK securities regulator the Financial Conduct Authority earlier this week endorsed HKEX’s stock and futures exchanges as Recognised Overseas Investment Exchanges, paving the way for the London office, which will be headed by Raymond Wong, head of EMEA business development with HKEX. HKEX-owned LME should tighten rules to prevent further market distortions: review In related news, the bourses of Shenzhen and London signed an agreement on Tuesday to set up a Shenzhen-London Connect to enhance “capital market connectivity”, which is the second leg of a cross-border link between the two countries. Three years ago, the stock exchanges of Shanghai and London established the Shanghai-London Connect for cross listings.