ASIA'S CAPITAL MARKETS | CHALLENGES & REGULATORY DEVELOPMENTS
Since the early large public offerings and trading of securities that assisted to finance expeditions of discovery and trade from the West to the East, the capital markets have served as an important platform to raise funding for enterprises to grow and for savers to invest. As the role of intermediaries and service providers expanded, the financial services sector has in turn become a significant contributor to many countries’ national GDP as well as a direct and indirect source of employment globally.
According to EY, in 2013, the Asia-Pacific region (including Greater China, ASEAN, Japan and Australia) represented the largest volume of initial public offerings (IPOs) and second largest amount raised globally (49% and 34% respectively). Asia-Pacific’s role (including as a source of listings in the United States and elsewhere) is only expected to grow with its continued robust economic activity, the resumption of Mainland China’s IPO markets and the opening up of more frontier markets.
Hong Kong is one of the leading global financial centres. It consistently ranks with New York and London as the world’s top IPO jurisdictions in terms of number and value of deals, and from 2009-2011 raised the most IPO funds in the world.
At the heart of trust in the global capital markets and its integrity is transparency – investors relying on company owners, directors and officers, and corporate finance professionals who have conducted due diligence on the businesses and management of the corporate issuers to ensure disclosure of material price- sensitive information to enable informed investment decisions and efficient price formation. This disclosure-based regulatory philosophy is now also being applied to Mainland China’s equity capital markets.