A golden era for the HK stock market

Today, mainland companies play a far more vital role in Hong Kong's capital markets.

According to HKEx data, the number of Hong Kong-listed companies soared from 658 in late 1997 (with only 101 listed mainland enterprises), representing 15 percent of the total, to approximately 2,009 by the end of March. More than 1,000 mainland companies had floated in Hong Kong by the end of last year, accounting for 51 percent of the total.

Total market capitalization had risen from HK$3.2 trillion ($410 billion) at the end of 1997 to HK$27.2 trillion by March.

The average daily turnover on the bourse has risen from HK$15.5 billion to HK$82.1 billion.

Total funds raised through IPOs, along with funds raised from 1997 until April 30, reached HK$8.7 trillion, with mainland enterprises, including H-shares, red-chips and private businesses, securing HK$5.4 trillion, or 62 percent of the total.

According to Bloomberg, nine out of 10 IPO underwriters are from the mainland, with China Construction Bank Corp, Haitong Securities Co and Agricultural Bank of China Ltd heading the list. In 1997, Morgan Stanley, HSBC Holdings and Merrill Lynch were the leading IPO underwriters among the top 10, which included only local and international companies.

Hu Zhanghong, chairman and chief executive officer of CCB International (Holdings) Ltd, said that Hong Kong's status as an international financial center has been further strengthened after the handover, especially over the last decade. The city has attracted enormous mainland capital, becoming the top destination for mainland enterprises looking to raise funds offshore.

"Hong Kong is the 'super-connector' between the mainland and the rest of the world. It has also evolved into a strategic platform for renminbi internationalization and the Belt and Road Initiative," he said.

Banks flood in

Hong Kong government statistics show that by the end of last year, mainland banks' assets in Hong Kong accounted for approximately 33 percent of the local banking system, compared with 13 percent in 1997. Currently, almost all State-owned and national joint-equity commercial banks have branches in Hong Kong.

According to the Hong Kong Chinese Enterprises Association, the city currently hosts nearly 4,000 mainland companies - double the number in 1997 - with total assets rising 22 times to almost HK$20 trillion.