ENG-2015 — Page 101

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Financial and Monetary Affairs

awareness of its services, the centre launched advertising campaigns and other promotional programmes in 2015, including investor education seminars, briefings and interviews, to promote its alternative services to industry professionals and investors.

Auditor Regulatory Reform

The international trend is for oversight of the regulation of auditors of public interest entities to be independent of the profession itself. In June 2015, the government issued the conclusions of a three-month public consultation conducted in 2014 on proposals to reform the regulatory regime for auditors of public interest entities, that is, listed entities in Hong Kong's context. The government is preparing an amendment bill and will continue to engage stakeholders.

Hong Kong as China's Global Financial Centre - Financial Co-operation with the Mainland

Capital Formation Centre and Global Investment Platform for the Mainland Hong Kong is the ideal centre for Mainland enterprises to raise capital. The growing presence of Mainland companies listed on the SEHK in turn has increased the breadth and depth of Hong Kong's securities and futures markets through a greater diversity of constituent stocks in the equity market and a wider range of products. Mainland enterprises also raise capital in Hong Kong through the issuance of bonds, project financing and loan syndication. Moreover, Mainland companies can leverage Hong Kong's position as an international business centre and its world-class investment banking services for mergers and acquisitions to invest in international markets.

Offshore RMB Business

In 2015, Hong Kong maintained its status as the global offshore RMB business hub and recorded steady growth in a number of areas. RMB trade settlement transactions handled by banks in Hong Kong amounted to RMB6,833.1 billion, up 9.2 per cent from 2014. RMB bank lending expanded by 58.2 per cent to RMB297.4 billion at end-2015 from the beginning of the year. Average daily turnover in the RMB Real Time Gross Settlement system reached RMB947 billion, up 29.2 per cent from 2014. Meanwhile, total RMB deposits, including customer deposits and outstanding certificates of deposit, fell 12.8 per cent to RMB1,010.4 billion at end-2015. RMB bond issuance also moderated to RMB74.6 billion from RMB196.8 billion in 2014.

Hong Kong is also the world's largest offshore RMB investment product market. It offers a wide range of products, including listed and unlisted investment funds, insurance products, currency futures, real estate investment trusts, shares and derivatives products. Qualified institutions continued to show interest in developing Renminbi Qualified Foreign Institutional Investor (RQFII)/Stock Connect products' in Hong Kong. The number of fund management companies managing SFC-authorised RQFII/Stock Connect funds increased from 38 at the end of 2014 to 41 at the end of 2015. In 2015, the SFC started allowing overseas fund managers to offer overseas funds in RMB in Hong Kong subject to certain conditions. At the end of 2015, there were 71 SFC-authorised RQFII/Stock Connect unlisted funds with an aggregate NAV of RMB20.8

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The RQFII/Stock Connect unlisted funds and ETFs are Renminbi-denominated funds which primarily invest in Mainland securities markets through either the RQFII quota, Stock Connect or both.

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