66 | Financial and Monetary Affairs
• continuing to be one of the most open insurance markets in the world, achieving an annual growth in premium of 17.3 per cent for the last five years; and
• the market capitalisation of Real Estate Investment Trusts (REITs) was $46 billion by year-end.
Hong Kong as an International Financial Centre
Hong Kong as a leading international financial centre in the region and the premier capital formation centre for the Mainland is helped by a favourable geographical position, bridging the time gap between New York and London; strong links with the Mainland and other economies in Southeast Asia and excellent communications with the rest of the world; the rule of law; a level playing field for carrying out business and a sound regulatory regime. The absence of restrictions on capital flows into and out of Hong Kong is another important strength.
Hong Kong's financial markets are characterised by a high degree of liquidity. They operate under effective and transparent regulations, which are in line with international standards. A highly educated workforce and ease of entry for professionals from outside Hong Kong also contribute to the development of its financial markets.
International financial institutions maintain a strong presence in the city. Of the world's top 100 banks, 69 have operations in Hong Kong. At the end of 2008, 135 of the 145 licensed banks in Hong Kong were foreign-owned.
The interbank money market is well established. Wholesale deposits are traded actively among local authorised institutions, and between local and overseas institutions, with an average daily turnover of $362.9 billion in 2008.
Hong Kong also has a mature and active foreign exchange market, which is an integral part of the global market. The link with overseas centres enables foreign exchange dealings with the rest of the world 24 hours a day. The last triennial survey co-ordinated by the Bank for International Settlements in 2007 shows the daily average foreign exchange turnover in Hong Kong as US$174.6 billion. Hong Kong continues to be the world's sixth largest foreign exchange market.
With a total market capitalisation of about $10,299 billion at year-end, the Hong Kong stock market ranked seventh in the world and third in Asia. The daily turnover averaged $72.1 billion in 2008. At year-end, 1 261 public companies were listed on the Stock Exchange of Hong Kong (SEHK). The 31 newly listed companies on the Main Board raised $66.0 billion from initial public offerings (IPOs).
Hong Kong ranked fifth worldwide in terms of IPO funds raised. Besides new share issues, $337.7 billion were raised on the secondary market. The Real Estate Investment Trusts market continued to develop and the aggregate market capitalisation was $46 billion at year-end.
The Hong Kong stock market is an important fund-raising platform for Mainland enterprises. At year-end, there were 465 Mainland enterprises listed on the SEHK. In