The Hong Kong Monetary Authority (HKMA) and the Securities and Futures Commission (SFC) published a joint release announcing that the SFC has reprimanded and fined The Hongkong and Shanghai Banking Corporation Limited (HSBC) HKD 4.2 million for breaching disclosure requirements in research reports on Hong Kong-listed securities. The enforcement action follows an investigation conducted by the HKMA in collaboration with the SFC after HSBC self-reported the issues. Regulators found that, in research reports published between 2013 and 2021, HSBC failed to disclose and/or made incorrect disclosures about its investment banking relationships with companies covered in those reports, with deficiencies in data recording and mapping across systems cited as the cause. The disclosure problems are estimated to have affected over 4,200 research reports. The SFC concluded HSBC failed to ensure compliance with the relevant disclosure requirement and the accuracy of disclosures with due skill and care, including by implementing effective systems and controls, and noted that paragraph 16.5(d) of the SFC Code of Conduct requires disclosure of an investment banking relationship with the issuer or new listing applicant in the research report.
Hong Kong Monetary Authority 2025-08-26
Securities and Futures Commission and Hong Kong Monetary Authority reprimand and fine HSBC HKD 4.2 million for research disclosure failures
The Hong Kong Monetary Authority and the Securities and Futures Commission fined The Hongkong and Shanghai Banking Corporation Limited HKD 4.2 million for breaching disclosure requirements in research reports on Hong Kong-listed securities. An investigation revealed HSBC's failure to disclose or incorrect disclosures about its investment banking relationships in over 4,200 reports from 2013 to 2021. Deficiencies in data recording and mapping were identified, and HSBC lacked effective systems and controls to ensure compliance with the SFC Code of Conduct.