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HK, Shanghai stock exchanges agree on new cooperation initiatives

(Xinhua)
Updated: 2010-01-22 11:53

Hong Kong Exchanges and Clearing Limited (HKEx) and Shanghai Exchange (SSE) Thursday agreed on new cooperation initiatives including a mechanism for regular exchanges and strengthening cooperation in the development of products like ETFs.

HKEx and SSE signed in January of last year a Closer Cooperation Agreement, which commits the two organizations to work together more closely towards the common goals of mutual prosperity and contributing to the greater development of China's economy.

"Jointly with our mainland counterparts, we can accelerate China's growth and financial development in a prudent manner," said HKEx Chairman Ronald Arculli.

As a result of the discussions, HKEx's Listing Division and SSE 's Company Management Department will establish a mechanism for regular exchanges in order to more effectively regulate companies and securities listed in both Shanghai and Hong Kong and better protect shareholder interests, according to a joint statement issued by the two exchanges after the discussions.

Moreover, HKEx and SSE agreed to strengthen cooperation in respect of the development of products and ETFs have become the starting point. At present, several fund management companies in the Chinese mainland are actively making preparations for the issue of ETFs related to Hong Kong stocks, said the statement.

It hoped that future cooperation on ETFs will be extended on a gradual basis to the development of ETFs on bonds and gold, as well as cross listings.

Besides ETFs, the two sides may seek further cooperation in products such as securities assets, warrants, Callable Bull/Bear Contracts and options.

What's more, cooperation in compiling an index comprising securities listed in Shanghai and Hong Kong may be explored to increase the Shanghai and Hong Kong stock exchanges' influence in the global market, said the statement.

HKEx and SSE also agreed to strengthen exchanges and cooperation on information technology that supports business development.

"The Shanghai and Hong Kong exchanges have their own technological advantages. There is ample room for the technology personnel of both organizations to share expertise, and explore possible ways to develop our respective technology support infrastructure to accommodate further and broader cooperation between the two markets," HKEx Chief Executive Charles Li said.

Since signing the cooperation agreement in January last year, HKEx and SSE have started a market data collaboration program, shared information on the development of ETFs and other products and arranged for HKEx executives to train at SSE and vice versa.