In a keynote address at the Asia Securities Industry and Financial Markets Association’s liquidity conference, Hong Kong Securities and Futures Commission Chief Executive Officer Julia Leung detailed progress and next steps on collateral efficiency, market microstructure and exchange-traded products. Building on the regulator’s September strategic action plan, she reported that average daily stock market turnover exceeded HKD 270 billion in 2026, up 160% from 2023, while bid-ask spreads tightened and execution times shortened. Collateral measures include higher rebates on cash collateral, lower charges on non-cash collateral and a phased reduction in the minimum client margin multiplier from 1.33 to 1.2, with a further cut to 1.1 targeted for March 2027 subject to regulatory approval. Mainland government and policy bank bonds represented about 18% of OTC Clear’s margin collateral as of August 2026, and HKEX plans to extend their eligibility to its largest futures and options clearing houses in November. The SFC and HKEX are also developing margin offsets across clearing houses, while OTC Clear is targeting same-day settlement for bond collateral deposits and withdrawals in 2026. Market structure reforms include the phased reduction of minimum trading spreads, standardized board lots and work toward T+1 settlement. The second phase of board lot reform for existing issuers will take effect in November, setting eight categories with values ranging from HKD 1,000 to HKD 50,000, while HKEX will publish its T+1 consultation conclusions and target implementation date. HKEX also plans a fourth-quarter discussion paper on extending cash market trading hours. Hong Kong’s daily exchange-traded product turnover has increased 3.6 times since 2023 and now represents nearly one-fifth of Main Board trading, supported by broader Stock Connect access, product expansion and liquidity providers accounting for more than 30% of recent turnover.

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