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HKEX Launches Synapse, A Settlement Acceleration Platform for Stock Connect

Mutual Market
Market Operations
04 Oct 2023
  • Market efficiency and transparency for Northbound Stock Connect participants enhanced by automating and streamlining post-trade operations
  • Latest Stock Connect development enabling international investors to better manage their post-trade operations across different time zones

 

Hong Kong Exchanges and Clearing Limited (HKEX) is today (Wednesday) pleased to announce the launch of HKEX Synapse, a new integrated settlement acceleration platform that utilises the latest technology to deliver greater market efficiency and transparency. Synapse is the latest enhancement to Stock Connect, the unique mutual market access programme that connects Mainland Chinese markets with those in Hong Kong. Synapse will launch on 9 October 2023, and will deploy DAML smart contracts to standardise and streamline post-trade workflows, enhancing operational efficiencies and transparency whilst reducing settlement risks.

Synapse is part of HKEX’s ongoing commitment to the development of Stock Connect, the efficient, accessible and cost-effective channel for investors participating in capital markets in Mainland China and Hong Kong. Other recent enhancements to Stock Connect include the addition of up to 10 Stock Connect trading days per year, as well as the inclusion of more than 1,000 additional stocks listed in Mainland China and made accessible to international investors via Northbound Stock Connect.

HKEX Synapse eliminates sequential processes, offering real-time visibility and insights into the settlement process for all market participants. Asset managers, brokers, custodians and clearing participants will benefit from real-time data synchronisation and improved scalability, helping them to handle the growing volume of trades through Northbound Stock Connect. Average daily turnover of Northbound Stock Connect totalled RMB109.3 billion in the first half of 2023, up 5 per cent from a year earlier, and a 50 per cent increase from 2020 levels.

HKEX Group Head of Emerging Business and FIC, Glenda So, said: “We are delighted to launch HKEX Synapse, a major enhancement to our Stock Connect infrastructure that will support the next phase of growth for international participation in Mainland China’s equity markets. This technology-empowered platform will not only improve post-trade efficiencies, but will, over time, build a better, stronger ecosystem, supporting both market growth and investor growth strategies. We are very proud to be introducing Synapse to our market and we look forward to continuing to embrace new technologies that benefit our markets and our customers in the future.”

Available as an optional service, HKEX Synapse will support institutional investors participating in Northbound Stock Connect to better manage their post-trade operations across different time zones, in particular with regard to adhering to the Mainland securities market’s T+0 settlement cycle.

HKEX Synapse will be linked with The Depository Trust & Clearing Corporation (DTCC) through its Institutional Trade Processing (ITP) service. With this integration, global investors and HKEX participants will benefit from the central matching of cross-border transactions using DTCC’s CTM service, which will automatically generate and send settlement instructions to the Synapse platform, streamlining the trade confirmation and settlement notification process.

Other details of HKEX Synapse are available on the designated Synapse webpage on the HKEX website.

 

 

About HKEX

Hong Kong Exchanges and Clearing Limited (HKEX) is a publicly-traded company (HKEX Stock Code: 388) and one of the world’s leading global exchange groups, offering a range of equity, derivative, commodity, fixed income and other financial markets, products and services, including the London Metal Exchange.

As a superconnector and gateway between East and West, HKEX facilitates the two-way flow of capital, ideas and dialogue between China and the rest of the world, through its pioneering Connect schemes, increasingly diversified product ecosystem and its deep, liquid and international markets.

HKEX is a purpose-led organisation which, across its business and through the work of HKEX Foundation, seeks to connect, promote and progress its markets and the communities it supports for the prosperity of all.

www.hkexgroup.com

 

 

Ends

Updated 04 Oct 2023