RETAIL FUNDS | Contributed Content, Taiwan

Hang Seng to dual-list two ETFs in Taiwan

Hang Seng Index ETF and Hang Seng H-Share Index ETF have been approved by the Financial Supervisory Commission, Executive Yuan, Taiwan for listing applications with the Taiwan Stock Exchange.

This approval makes the two exchange-traded funds the first Hong Kong ETFs to have obtained permission from the FSC to apply for dual-listing under a cross-listing regime recently established by Hong Kong and Taiwan.

On 22 May 2009, the Securities and Futures Commission of Hong Kong and the FSC signed and exchanged a Side Letter to a bilateral Memorandum of Understanding agreed in 1996 which facilitates the cross-listing of ETFs in the two markets.

Mrs Margaret Leung, Vice-Chairman and Chief Executive of Hang Seng Bank, said: "Hang Seng is delighted that two of our ETFs are the first to have obtained permission from the FSC to make dual-listing applications with the Taiwan Stock Exchange. The new cross-listing regime allows Taiwanese investors to directly invest in Hong Kong ETFs. This new investment opportunity highlights the growing financial ties between Hong Kong and Taiwan, which will benefit both markets in terms of product variety and innovation."

Under the dual-listing structure, HSBC Global Asset Management (Taiwan) Limited has been appointed the master agent of the ETFs in Taiwan. Taiwanese securities broker, Yuanta Securities, is the first firm to have been appointed as a Taiwan participating dealer for the ETFs. With the strong local presence of these two institutions, Taiwanese investors will be able to invest in the ETFs at lower transaction costs in a more transparent manner under the dual-listing structure.

Managed by Hang Seng Investment Management Limited, a wholly-owned subsidiary of Hang Seng Bank, Hang Seng Index ETF and Hang Seng H-Share Index ETF were launched in Hong Kong on 13 September 2004 and 19 November 2003 respectively and spearheaded the development of Hong Kong’s ETF market. As at 28 July 2009, the total assets of Hang Seng Index ETF were HK$22.2 billion and those of Hang Seng H-Share Index ETF stood at HK$15.1 billion.

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