Regulators from Hong Kong and Singapore have been taking advantage of the increased levels of regulation soon to be introduced for UK financial services, and the relative turmoil created around the economic uncertainty generated by Brexit. On the back of this Asia regulators are focused on a derivatives’ markets takeover.
For almost six months the two have been in talks with Asia Securities Industry and Financial markets Association – both organisations represent global lenders in Asia.
The regulators for Hong Kong and Singapore – the Hong Kong Monetary Authority (HKMA) and Monetary Authority of Singapore (MAS) respectively – are looking to grab a significantly increased share of the $540 trln global derivatives trades for their financial markets.
They are focused on determining what form of regulatory changes need to be implemented in Hong Kong and Singapore to attract banks along with their derivatives businesses in either domicile. This initiative offers the region the potential to create thousands of jobs in Asia.
The derivatives in the sights of the regulators include interest rate swaps or foreign exchange derivatives, which allow investors and companies to hedge their exposure to interest rate rises and currency volatility.