HKEx to Introduce T+2 Finality on 25 July

Hong Kong Exchanges and Clearing Limited (HKEx) announced July 7 that it will introduce a T+2 Finality arrangement for money settlement in CCASS, the Central Clearing and Settlement System for the Hong Kong securities market, on Monday, 25 July following the successful completion of the simulation test and the approval of necessary rule amendments by the Securities and Futures Commission.

Under T+2 Finality, securities and money settlement is completed and finalised on T+2 (two business days after the trade). HKEx’s T+2 Finality arrangement will be supported by a new interbank bulk settlement run in the evening of T+2 that will be introduced by Hong Kong Interbank Clearing Limited (HKICL) on 25 July.

“The new arrangement will reduce the overnight credit risk of the securities market and align the money settlement arrangement in Hong Kong with the international best practices by bringing finality of securities and money settlement on the same day,” said Derrick Fung, HKEx’s Head of Clearing.

“We would like to thank CCASS Participants, Designated Banks*, the Hong Kong Monetary Authority and HKICL for their support for the implementation of T+2 Finality,” Mr Fung added.

HKEx’s consultation paper on T+2 Finality and the consultation conclusions are available on the HKEx website.

* Designated Banks are banks in Hong Kong chosen by Participants of HKEx’s securities clearing house and approved by the clearing house for money settlement purposes.

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