What Will Happen with the Hong Kong Stock Exchange After 2047?

The author analyzes the history of Hong Kong Exchanges and Clearing Limited (HKEX) development and the possible consequences of Hong Kong autonomy liquidation. Since Hong Kong’s economy is based on free-market principles and is notable for low taxation and state non-interference, the stock exchange is one of the main institutions contributing to the economic development of Hong Kong as a special administrative region. Since the beginning of the 21st century, the Chinese authorities have made active attempts to change the special autonomous status of Hong Kong. In 2003, mainland Chinese authorities tried to promote the Law on Protection of National Security. The initiative drew criticism from Hong Kong residents and led to large-scale protests. A wave of protests in Hong Kong in 2014 was provoked by Beijing’s attempt to control local elections in the autonomous region. In 2019, the PRC government attempted to pass an extradition law, which triggered a new wave of social tension. Beijing’s interventions affected the Hong Kong Stock Exchange Index and the economic health of the special administrative region. There are known cases in which the fall of a major stock index led to economic collapse. For example, the 1929 stock market crash, known as the Wall Street crash, caused the Great Depression in the United States, while the Dow Jones index drop of October 19, 1987, also had influence on the world economy by affecting the stock indices of other countries. In recent years, it has become increasingly difficult to separate Hong Kong’s political autonomy from its economic strength. The current “one country — two systems” policy ensures the status quo for Hong Kong’s stock exchange and prevents Beijing from regulating it. But the abolition of autonomy in 2047 will entail not only political but also economic changes that could affect all of Hong Kong’s financial structures.

Factors That Affect Profitability of Banks Comparative Study between Indonesian and Hong Kong

The problem of this research was the influence of liquidity risk, net credit facilities to total assets ratio, total investment to total assets ratio, total equity to assets ratio, net credit facilities to total deposits ratio, cost to income ratio, and bank size toward return on assets. The objective of this research was to identify the factors that influence return of assets of banks listed in Indonesia Stock Exchange and Hong Kong Stock Exchange over the period 2012-2015. The methodology of this research was multiple linear regression which is tested by using classic assumption. Sample in this research were 27 Banks listed in Indonesia Stock Exchange and 13 Banks listed in Hong Kong Stock Exchange over period 2012-2015. Finding and contribution in this research were liquidity risk, total equity to assets ratio, net credit facilities to total deposits ratio, cost to income ratio, and bank size have influence toward return on assets of banks in Indonesia. Meanwhile, net credit facilities to total assets ratio and total investment to total assets ratio do not have influence toward return on assets of banks in Indonesia. Liquidity risk, total equity to assets ratio, and cost to income ratio have influence toward return on assets of banks in Hong Kong, meanwhile credit facilities to total assets ratio, total investment to total assets ratio, net credit facilities to total deposits ratio, and bank size do not have influence toward return on assets of banks in Hong Kong. Research limitation or implication in this research was for banking management to use the the information to maintain or even increase the profitability of banks, and to investors for being used as considerations to invest in banking sectors.Keywords: profitability, liquidity risk, bank size, investment