Financial Regulation in Hong Kong: Time for a Change

Arner, Douglas W.; Hsu, Berry Fong-Chung; Roza, Antonio M. Da

doi:10.2202/1932-0205.1238

Cited by 5 publications

(9 citation statements)

References 2 publications

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“…Under the ordinance, the SFC is an independent statutory body that regulates the securities and futures markets in Hong Kong (Arner et al. ; HKEx ). Another reform was the restructuring of the Council of the Hong Kong Stock Exchange in 1991.…”

Section: Stock Market Development In Hong Kongmentioning

confidence: 99%

“…Under the ordinance, the SFC is an independent statutory body whose task is to regulate the securities and futures markets in Hong Kong (Arner et al. ).…”

Section: Stock Market Development In Hong Kongmentioning

confidence: 99%

“…However, the presence of the various MoUs has revealed regulatory gaps, overlapping in the roles of the regulators, and questions as to whether their roles are inadequately delineated in the context of financial market regulations (Arner et al. ).…”

Section: Challenges Facing Stock Market Development In Hong Kongmentioning

confidence: 99%

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Stock market performance in Hong Kong: an exploratory review

Odhiambo

2015

Asian-Pac Economic Lit

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This paper reviews the origin and development of the stock market in Hong Kong. The first formal stock exchange, the Association of Stockbrokers in Hong Kong, was formed in 1891. However, the activities of the stock exchange are generally regarded as insignificant until the 1970s. Since the 1980s, there have been a number of major reforms and some significant developments. These include the unification of four stock exchanges; the establishment of the Securities and Futures Commission; the closer economic relations with Mainland China; the merger of the Hong Kong Stock Exchange and the Hong Kong Futures Exchange to form the Hong Kong Exchanges and Clearing Limited (HKEx); the launch of the second board (Growth Enterprise Market); and the demutualisation of the HKEx. The Exchange generally responded positively to these reforms and developments. As a result, the Hong Kong stock market experienced significant growth in terms of its market capitalisation ratio, turnover ratio, and the total value traded ratio. Despite the impressive growth in various stock market indicators, however, the Hong Kong stock market still faces some challenges, including regulatory challenges, as well as some concern over its future viability as a global equity hub.

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Section: Stock Market Development In Hong Kongmentioning

confidence: 99%

“…Under the ordinance, the SFC is an independent statutory body whose task is to regulate the securities and futures markets in Hong Kong (Arner et al. ).…”

Section: Stock Market Development In Hong Kongmentioning

confidence: 99%

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Stock market performance in Hong Kong: an exploratory review

Odhiambo

2015

Asian-Pac Economic Lit

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“…Moreover, after the collapse of Lehman Brothers, Hong Kong still lacks a comprehensive compensation scheme, which includes a special crisis management mechanism to deal with banks or financial groups' failure (Arner et al, 2010). Therefore, it is suggested that Hong Kong should take initiative in improving the financial regulatory structure with respect to the international standard, rather than taking a reactionary approach as a result of crisis ).…”

Section: Hong Kong Financial Regulation: Necessity Of Bank Crisis Manmentioning

confidence: 99%

“…This implication can also apply in cross-border bank insolvency. Even though Hong Kong has close relationships with international organizations, such as Financial Stability Board and Basel Committee on Banking Supervision, Arner (2010) points out that Hong Kong still lacks crisis management scheme for banks, as well as highlights the weakness of the deposit insurance scheme in dealing with failure of financial institutions.…”

Section: Introductionmentioning

confidence: 99%

Banking crises and Hong Kong

Kan

Bagheri

2015

Int Jnl Law Management

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Purpose – This paper aims to explain the importance of the international cooperation and coordination among supervisory authorities of different countries in event of banking crises. It also suggests that the harmonious relationship has to be attained in the adoption of ex ante financial regulatory measures and ex post compensation schemes. In other words, the paper highlights the linkage between ex ante preventive regulatory measures and ex post compensation schemes, on the one hand, and cooperation among national regulatory and supervisory authorities in globalized financial markets. Although the paper is relevant to most developed and emerging financial markets, it chooses Hong Kong as a context to examine this proposal. In the current literature, there are no similar approach linking these two paradigms and examining them in an integrated context. Design/methodology/approach – The paper adopts a conceptual framework after the 2008 global financial crisis and takes Hong Kong, an international financial centre in which numerous branches or subsidiaries of foreign financial institutions locate, as an example to examine how the coordination with foreign supervisory authorities are being conducted and to analyse whether the present regulatory framework in Hong Kong is effective and sufficient against banking crises. Through the review of the literature, the important link between ex ante regulatory measures and ex post compensation schemes is found to be significant in adopting proper solutions. Findings – Through analysing the Hong Kong financial regulators’ reports on the collapse of Lehman Brother, the paper finds out that even though there is some weakness in the cooperation and coordination between regulators after the 2008 financial crisis, Hong Kong is still in the progress of proposing bank special resolution regime. Although there has been some awareness on the issue of coordination between home and host states regulatory measures, there is still a lack of awareness of the connection between regulatory measures and compensation schemes. Research limitations/implications – Conflict of interests could hardly be prevented in the course of cooperation and coordination among home and host regulatory authorities, and the coordination of the important link between ex ante regulatory measures and ex post compensation scheme which involves legal and economic analyses is a challenging task. Practical implications – The paper’s findings show that there are practical implications for the recent rapid development of special resolution regime for global systematically important financial institutions against future banking crises and for managing the balance between the adoption of financial supervisory laws and special resolution measures. Originality/value – This paper suggests that the harmonious coordination between ex ante regulatory measures and ex post compensation schemes has to be achieved through international context to avoid the absurd situations. This conceptual integrated framework p...

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Financial Regulation in Hong Kong: Time for a Change

2010

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The global financial system experienced its first systemic crisis since the 1930s in autumn 2008, with the failure of major financial institutions in the United States and Europe and the seizure of global credit markets. Although Hong Kong was not at the epicentre of this crisis, it was nonetheless affected. Following an overview of Hong Kong's existing financial regulatory framework, the article discusses the global financial crisis and its impact in Hong Kong, as well as regulatory responses to date. From this basis, the article discusses recommendations for reforms in Hong Kong to address weaknesses highlighted by the crisis, focusing on issues relating to Lehman Brothers “Minibonds.” The article concludes by looking forward, recommending that the crisis be taken not only as the catalyst to resolve existing weaknesses but also to strengthen and enhance Hong Kong's role and competitiveness as China's premier international financial centre.

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Financial Regulation in Hong Kong: Time for a Change

Cited by 5 publications

References 2 publications

Stock market performance in Hong Kong: an exploratory review

Stock market performance in Hong Kong: an exploratory review

Banking crises and Hong Kong

Financial Regulation in Hong Kong: Time for a Change

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