Hong Kong SFC Briefs About 10 Brokers on Raid Cooperation as IPO Funds Jump 76%

Hong Kong's Securities and Futures Commission has told investment banks how to cooperate with regulatory raids, a sign that the city is tightening supervisory scrutiny, particularly of its increasingly active equity offering market. On August 17, 2026, SFC Chief Executive Officer Julia Leung and Kenneth Luk, Senior Director of the Enforcement Division, attended a meeting with senior investment bank executives. Luk explained what institutional staff should do when facing a search, requiring financial institutions to train front-desk personnel to handle search warrants promptly, lead investigators to designated areas, and arrange a separate room away from other visitors.

Representatives of about 10 brokers were also told that regulators must be allowed to access employee emails and computer systems on the day of the search, and that an internal investigation should be launched if news of a search leaks to the media. The SFC responded that it has not issued written instructions on raids, but shares its expectations and executable operating procedures with market practitioners from time to time to promote best practices in internal controls and compliance. The SFC declined to comment on the August meeting.

In recent years, a large number of Chinese artificial intelligence, robotics, and other technology companies have sought financing, driving an unprecedented boom in Hong Kong stock issuance. Data show that at least 500 companies plan to list in Hong Kong, not including those that have filed listing applications confidentially. Hong Kong Exchanges and Clearing data show that in the first eight months of 2026, total funds raised in Hong Kong through initial public offerings and follow-on placements jumped 76% year on year to HKD 651 billion.

Equity offering activity has accordingly become a regulatory focus. Attendees were told that banks and other advisers, while strengthening internal controls, should also consider market capacity and select quality issuers. At the same time, regulatory raids have increased markedly. About eight brokers or funds have been searched in Hong Kong in 2026, far more than in previous years. The institutions searched include the Hong Kong units of CITIC Securities, Guotai Junan, CCB International, and China Securities International. The companies did not comment on the searches at the time.