5 Increase in Income due to Higher Market Turnover
6 Investment income Corporate Funds HK$'000 Margin Funds HK$'000 Clearing House Funds HK$'000 HKEx Group Total HK$'000 Supervised by Treasury: Investment income (A)201,51173,56917,706292,786 Average amount of funds4,740,4804,741,2281,138,26110,619,969 Annualised yield4.25%1.55%1.56%2.76% Accommodation Income (B)5,163 Investment in Singapore Exchange Limited (C)13,358 Total investment income (A+B+C)311,307
9 Producing Value for Shareholders The company has carried out a review of the Group’s policy regarding its cash funds, which are made up largely of liquid funds required in connection with our clearing businesses but also include substantial retained earnings. The review has taken into account the changed economic environment, the Group’s strategy and our major medium-term capital and risk management requirements. Following the review, the Board has recommended, in addition to the final dividend, a special dividend of $1.68 per share.
10 2004 Key Initiatives – Expanding Relationship with the Mainland China Listing u Attract more major, high quality Mainland enterprises u Enhance listing services to Mainland issuers China Products u Develop more China-related products Cooperation u Explore crude oil contract with Shanghai Futures Exchange u Explore cooperation with Shenzhen Stock Exchange
11 2004 Key Initiatives - Building a Quality Market Strengthen Market Infrastructures u Introduce DCASS u Strengthen the reliability, security and availability of market systems u Explore the possibility of network consolidation (i.e. AMS/3, CCASS/3, HKATS and Market Data Feed) for cost reduction at HKEx and Participants without sacrificing service quality u Further study the potential impact of a scripless market u Further study Enhanced CCASS Investor Participant Account services u Further strengthen risk management capabilities
12 2004 Key Initiatives – Building a Quality Market Improve Investor Protection u Improve the listing regulatory structure based upon the outcome of the Government review u Revamp the Listing Committee’s role in decision-making and related structures u Improve disciplinary process u Promote the statutory backing for selected Listing Rules u Consider delisting mechanism u Consider market views on regulation of sponsors and IFAs
13 2004 Key Initiatives – Building a Quality Market Improve Investor Protection (cont’d) u Improve the transparency of the odd lot market u Enhance investor education u Introduce a Mock Trading System for investor education u Enhance HKEx Corporate Website u Strengthen market education and director training
14 2004 Key Initiatives – Building a Quality Market Improve Market Liquidity u Review the trading spreads in the securities market u Review the market making mechanism for ETFs u Study the introduction of more structured products u Review the stock options market and introduce more single stock options u Organise international roadshow to promote our securities and derivatives markets to international investors