Beijing’s brokerage probe to stop ‘leakage’, Paul Chan tells Davos Dalian event

Beijing’s recent investigation into three brokerages – Futu Securities, Tiger Brokers and Long Bridge – was partly driven by concerns over foreign exchange “leakage” and the need to protect mainland China’s vast base of retail investors, Hong Kong’s finance chief has said.

At a closed-door C-suite round table organised by the South China Morning Post on Wednesday, Financial Secretary Paul Chan Mo-po said Beijing was overall “supportive” of Hong Kong’s role as an international financial centre.

But he added that the central government still needed to be cautious about potentially destabilising capital outflows and investor losses.

“[Beijing] wants Hong Kong to succeed, but at the same time, they have to do this carefully,” Chan said.

The round table discussion was held on the sidelines of the World Economic Forum’s Annual Meeting of the New Champions, also known as “Summer Davos”, in Dalian, Liaoning province.

“Because on the mainland, investors are mainly retail investors, while in Hong Kong, it’s mainly institutional investors,” he said.