Unlike the existing IPO system, which involves different parties using many manual processes and paperwork to exchange information, FINI will operate as a cloud-based platform enabling different listing stakeholders – such as sponsors, underwriters, legal advisers, banks, clearing participants, share registrars and regulators – to collaborate and perform their respective roles digitally in real time.
“This cloud-based, real-time settlement process can benefit market stakeholders in this digital era,” said Robert Lui, divisional president for Greater China at CPA Australia, an accounting body. “A shorter settlement time can drive efficiency, reduce risk and free up capital, bringing benefits to all professional parties in the IPO process.
“Specifically, FINI reduces risk for lawyers by centralising data and providing transparent information via a single platform. Sponsors can check the real-time status of subscriptions and share allotment and money settlement data. FINI can free up capital for investors, enabling them to subscribe to more IPOs.”
FINI is HKEX’s latest effort to boost the Hong Kong IPO market this year after the opening of a New York office in June and a London office earlier this month to attract international listings.
The digital platform will replace the existing IPO settlement system operated through a central clearing and settlement system after the market closes on November 21, and all new listings whose prospectuses are published on or after November 22 will be processed on FINI, HKEX said.
“FINI is a major development for Hong Kong’s capital markets, bringing greater efficiency and convenience to market participants and issuers, helping them to better manage their risks and costs,” said Nicolas Aguzin, HKEX’s CEO.
“The new platform also underpins HKEX’s steadfast commitment to further enhancing the competitiveness and attractiveness of our markets, modernising Hong Kong’s market infrastructure and promoting collaboration.”
Besides shortening settlement times, FINI will have a new pre-funding model that will reduce the scale of locked-up funds in oversubscribed IPOs, HKEX said.
The new platform will also be useful when there are many mega IPO offerings, and it will enhance Hong Kong as an IPO destination, added CPA Australia’s Lui.
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