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Hong Kong stock exchange operators made record profits in 2024 as stock market rallies and revivals help to end the financial hub’s two-year slump.
Hong Kong exchange and clearing reported full-year profit of HK$13.1 billion (US$1.7 billion) on Thursday, breaking record before the Hong Kong-era trading boom set in 2021.
For the fourth quarter, profit increased 46% year-on-year to HK$3.8 billion. Revenues rose by a third to HK$6 billion.
The results were increased as investors returned to Hong Kong stocks after an investor announced a series of stimulus packages last fall.
Last year, “HKEX has achieved significant strategic advances,” CEO Bonnie Chang said in a statement, adding that there are “encouraged signs of economic revitalization,” including China’s stimulating policies in other markets and interest rate cuts.
In an interview with the Financial Times, Chang said the emergence of Deepseek’s artificial intelligence model has been a catalyst in attracting investors’ attention to Chinese tech companies, boosting Hong Kong’s trading volume this quarter.
“If you’re a fund manager… You really need to focus on it and study, and the moment they start doing it, they do it.. AI, New Energy has all these exciting tech companies in various spaces in China, and in the way it’s very cheap valuation,” she said.
The results show the first year of Chang’s tenure after former Star JPMorgan banker Nicholas Agjin left last year.
HKEX listed 71 new companies last year and after cutting global rankings in 2023, it regained its slots as the top four early public offering market.
The exchange raised $190.3 billion in funding from the IPO, including HK$87.5 billion. This is an 88% increase from the previous year.
Over the past 12 months, HKEX stocks have grown nearly 48%, surpassing a 42% increase in the Benchmark Hangsen Index.
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Last year, mainland Chinese authorities expressed support for Hong Kong’s capital markets, expanding the scope of stock-connected trading links with the mainland, and increasing the use of the yuan in specially managed areas.
Chang said the southbound yuan counter that will allow mainland investors to buy stocks in Hong Kong in their own currency will be operational “hopefully by the end of the year.”
“From the perspective of HKEX, the focus is on creating more products for the yuan,” said Chang.
The exchange also ended the practice of suspending trades during typhoons. Typhoons are a much-loved anachronism to many city finance experts, but they have been criticized for their globally decreasing competitiveness.
