(Yicai Global) Feb. 24 -- Hong Kong Exchanges and Clearing reported its best ever fourth-quarter earnings and announced a plan to expand the Chinese mainland-Hong Kong stock connect program to include international firms listed in the special administrative region.

Net profit rose 11 percent from a year earlier to HKD3 billion (USD382.3 million) in the three months ended Dec. 31, the bourse operator said in its most-recent trading report released yesterday. Operating revenue rose 10 percent to HKD5.2 billion. Full-year net profit fell 20 percent to HKD10.1 billion (USD1.3 billion) on a 9 percent drop in operating revenue to HKD18.4 billion.

Ninety firms went public on the Hong Kong Stock Exchange in 2022, raising HKD104.6 billion (USD13.3 billion), a 68 percent slump from 2021 and ranking fourth worldwide, HKEX said, adding that 63 listed in the second half, with 21 debuting in December alone.

Thanks to this strong momentum, the market for initial public offerings has shown signs of recovery entering 2023 and HKEX is processing a large number of listing applications, it said.

“The Shanghai-Hong Kong and Shenzhen-Hong Kong Stock Connects will include Hong Kong-listed international companies in the next months to help them reach investors through the schemes,” Chief Executive Alejandro Nicolas Aguzin said during HKEX’s earnings conference call yesterday.

Stamp duty is an important source of income for the SAR government, Aguzin noted, so HKEX is in talks with officials about stamp duty on stock trading, hoping to achieve a satisfactory result.

Hong Kong levied a 0.13 percent duty on stock transactions last year. This, combined with the high transaction fee rate charged by Hong Kong brokers, makes Hong Kong’s stock trading fee rate much higher than the 0.1 percent in the Chinese mainland.

The Hang Seng Index has halved since Hong Kong Financial Secretary Paul Chan said in February 2021 that the SAR was planning to raise stamp duty to 0.13 percent from 0.1 percent. HKEX was very disappointed at the government’s decision, a spokesperson said at the time.

As an international financial hub, Hong Kong should allow investors to trade seamlessly when the global market is open and consider how to solve the issue of trading halts due to weather conditions, Aguzin added.

HKEX’s stock [HKG: 0388] finished 2.5 percent lower at HKD319.40 (USD40.70) today. The benchmark Hang Seng Index fell 1.7 percent.

Editor: Futura Costaglione