Global Trustee and Fiduciary Services Bite-Sized Issue 10 2023

Global Trustee and Fiduciary Services Bite-Sized | Issue 10 | 2023 10 QUICK LINKS CBDC DIVERSITY & INCLUSION FINTECH FUND LIQUIDITY OPERATIONAL RESILIENCE SUSTAINABLEFINANCE/ESG ASIA EUROPE LUXEMBOURG NORTH AMERICA UNITED KINGDOM ASIA SFC-HKMA Joint Product Survey in 2022 Shows Shifts to Investments in MMFs On 27 September 2023 the Securities and Futures Commission (SFC) and the Hong Kong Monetary Authority (HKMA) published the findings of their 2022 joint survey on the Sale of Non-exchange Traded Investment Products by licensed corporations (LCs) and registered institutions (RIs). Money Market Funds (MMFs) were the top-selling collective investment schemes (CIS) based on the top five CIS reported by the large firms, accounting for 61% of the total top five CIS transaction amount in 2022, up from 33% a year earlier. Bond funds and equity funds came second and third, accounting for 14% and 7% of the total. Other major observations from the survey included: • Structured products remained the most prevalent type of products sold by the respondent firms during 2022, constituting 51% (HKD 1,921 billion) of the total transaction amount. CIS and debt securities followed, accounting for 23% (HKD 884 billion) and 17% (HKD 648 billion), respectively. • Equity-linked structured products remained predominant, representing 53% of all the structured products sold in 2022. Some investors shifted to other product types such as currency-linked products owing to weak sentiment in stock markets in 2022. • On debt securities, some investors shifted their interest to sovereign bonds, such as HKSAR Government bonds including Green Bonds and Silver Bonds, which were perceived to be of lower risks with more stable returns. • The number of firms distributing investment products online increased to 83 in 2022, up 19% from 2021. CIS remained the most common product type distributed through online platforms, which represented 83% of total online sales. Of all CIS investors, the proportion of investors transacting online also increased from 65% in 2021 to 72% in 2022. Notably, online sales of debt securities increased significantly to 15% of the total online sales in 2022 from 6% in 2021. Link to Joint Survey here SGX RegCo Consults on Proposed Changes to Futures Trading Rules and Other Rulebooks On 21 September 2023 the Singapore Exchange Regulation (SGX RegCo) issued a consultation seeking market feedback on several changes to its Futures Trading Rules (FTR), Singapore Exchange Securities Trading (SGX-ST) rules and Singapore Exchange Derivatives Clearing (SGX-DC) rules. SGX RegCo’s proposed amendments to the FTR involve updates to policies and rules including those relating to: • The admission and registration of Singapore Exchange Derivatives Trading (SGX-DT) Members’ representatives; • The requirements pertaining to customer margining where Members will have more flexibility in managing margin cycles, customer funds and collateral; and • The requirements for automated trading to formalise key aspects of the Algorithmic Trading Regulatory Guide. In addition, the revision aims to improve the clarity and readability of the rules. Amendments are proposed to align the SGX-ST rules with the FTR, where relevant, and include changes to rules on automated trading and termination of membership. Similarly, amendments to the SGX-DC Clearing Rules are made to reflect corresponding FTR changes governing customer collateral. The consultation period closed on 11 October 2023. Link to Consultation here