HKEX to launch new IPO settlement platform: From T+5 to T+2

Rick Steves

“By digitalising, streamlining and modernising IPO settlement workflows, FINI will shorten the time between IPO pricing and the start of trading, enhancing market efficiency and strengthening the competitiveness and attractiveness of Hong Kong’s IPO market.”

Hong Kong Exchanges and Clearing Limited (HKEX) has announced plans to launch a new IPO settlement platform in October this year.

Going by the name of FINI, the initiative is expected to significantly shorten the time between the pricing of an IPO and the trading of shares from five business days (T+5) to two business days (T+2).

FINI will modernize and digitalize Hong Kong’s IPO settlement process, driving efficiency and supporting the long-term development of Hong Kong as a capital raising center, said HKEX in a statement.

FINI will shorten the time between IPO pricing and the start of trading

Nicolas Aguzin, Chief Executive Officer at HKEX, said: “We are delighted to confirm the launch of this major IPO settlement reform. By digitalising, streamlining and modernising IPO settlement workflows, FINI will shorten the time between IPO pricing and the start of trading, enhancing market efficiency and strengthening the competitiveness and attractiveness of Hong Kong’s IPO market.”

“Throughout the conceptualisation, system development and external testing phases of FINI’s development, we have received strong support from market stakeholders demonstrating the widespread appetite for progressive innovations in the Hong Kong IPO market. I would like to thank all those who have provided feedback and contributed to the process as we continue to build the Marketplace of the Future.”

HKEX will arrange market practice sessions and market rehearsals in July and August, respectively, to simulate interactive, end-to-end IPO settlement operations under FINI.

HKEX’s FINI approved by Hong Kong’s SFC

The cloud-based platform will enable different stakeholders such as IPO sponsors, underwriters, legal advisers, banks, Clearing Participants, share registrars and regulators to collaborate and perform their respective roles in an IPO, digitally.

The new platform will also introduce a new public offer pre-funding model to help alleviate the scale of funds that are locked up in over-subscribed IPOs.

With approval from the Securities and Futures Commission, HKEX also published updates to relevant Listing Rules, Hong Kong Securities Clearing Company Limited (HKSCC) Rules, and HKSCC Operational Procedures, which will take effect on the commencement date of FINI.

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