HKEX starts consultation on shortening settlement cycle in cash equities market
Hong Kong has stuck to T+2 since 1992, while up to 88 per cent of global cash equities are expected to settle on T+1 or sooner
The city’s bourse operator said the move would create a path for how and when to implement the idea as global financial markets had started adopting faster timelines, according to a document released on Wednesday. It aimed to build consensus and develop a detailed implementation timeline with views from other stakeholders, it added.
Up to 88 per cent of global cash equities by trade value were expected to settle a day after trade, commonly known as T+1, HKEX said. The US has moved to T+1, while Australia and the European Economic Area are exploring similar transitions. Hong Kong has operated under a T+2 settlement cycle since 1992.
“In a rapidly evolving global market landscape, there is urgency to seek a way forward,” CEO Bonnie Chan Yiting said. As a market operator, HKEX was fully committed to “ensuring that our financial ecosystem remains robust and fit for purpose”, she added.