Supervisory Policy Manual (SPM): CR-S-4 “New Share Subscription and Share Margin Financing”

The Chief Executive

All Authorized Institutions

Dear Sir / Madam,

I am writing to inform you that, following consultation with the two industry Associations,

the Monetary Authority issues by notice in the Gazette today a revised version of the SPM

module CR-S-4 “New Share Subscription and Share Margin Financing” as a statutory

guideline under section 7(3) of the Banking Ordinance. The revised module will take

effect on 22 November 2023.

The revised SPM module has incorporated changes consequential to the initial public

offering settlement reform by The Hong Kong Exchanges and Clearing Limited through

the launch of Fast Interface for New Issuance. The opportunity has also been taken to

provide further guidance on a holistic approach to risk management of share margin

financing, taking into account the latest incidents in the market.

On-line access to the revised SPM module is available on the HKMA’s public website

(https://www.hkma.gov.hk/eng/regulatory-resources/regulatory-guides/supervisorypolicy-manual/) and the Supervisory Communication Website (https://www.stet.iclnet.hk).

Should you have any questions relating to this SPM module, please contact Mr Eric Ng

(2878-8603), Ms Niki Wong (2878-1473) or Ms Sally Lo (2878-1521).

Yours faithfully,

Cho-hoi Hui

Acting Executive Director (Banking Policy)

Encl : Supervisory Policy Manual (SPM): CR-S-4 “New Share Subscription and Share Margin Financing”

cc:

The Chairperson, The Hong Kong Association of Banks

The Chairperson, The DTC Association

FSTB (Attn: Mr Justin To)