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<Research>Jefferies: Stricter Scrutiny for Mainland Investors Opening Investment Accounts in HK; Deposit and Savings Accounts Unaffected
The share selloff yesterday (4th) in HSBC HOLDINGS (00005.HK), STANCHART (02888.HK), PRU (02378.HK), AIA (01299.HK) and UBS reflected a market misinterpretation of reasonable regul...
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<Research>Jefferies: Stricter Scrutiny for Mainland Investors Opening Investment Accounts in HK; Deposit and Savings Accounts Unaffected
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The share selloff yesterday (4th) in HSBC HOLDINGS (00005.HK)  -4.600 (-3.142%)    Short selling $650.59M; Ratio 15.623%   , STANCHART (02888.HK)  -10.400 (-4.910%)    Short selling $9.84M; Ratio 1.564%   , PRU (02378.HK)  -6.900 (-6.389%)    Short selling $455.31K; Ratio 1.627%   , AIA (01299.HK)  -2.700 (-3.520%)    Short selling $1.75B; Ratio 16.079%   and UBS reflected a market misinterpretation of reasonable regulatory measures by mainland authorities to restrict outbound investment activities conducted through grey channels, Jefferies said in its report.

In fact, these regulatory measures instead fortify the position of international financial institutions, as they are conducting business through the "Connect" mechanisms actively encouraged by Beijing and are normally attracting offshore deposits in Hong Kong. The broker viewed this as a formalization of existing procedures.

Related News CICC: HSBC HOLDINGS (00005.HK) Focuses on Core Strengths, Continues to Strengthen Moat
On the banking side, the broker’s channel checks indicated that mainland investors opening deposit and savings accounts are unaffected, while those opening investment accounts face stricter scrutiny. The broker believed this is conducive to international banks with dominant positions in the Hong Kong market, such as HSBC HOLDINGS (00005.HK)  -4.600 (-3.142%)    Short selling $650.59M; Ratio 15.623%   and STANCHART (02888.HK)  -10.400 (-4.910%)    Short selling $9.84M; Ratio 1.564%   , as their offshore clients are primarily deposit-based.

The broker forecast limited impact on BOC HONG KONG (02388.HK)  0.000 (0.000%)    Short selling $96.64M; Ratio 14.626%   , as its cross-border business is more corporate-related, while the China business growth of BANK OF E ASIA (00023.HK)  -0.230 (-1.665%)    Short selling $1.69M; Ratio 7.416%   is more centered on wealth management.

For insurers, the broker noted a marked difference between investors allocating equity assets themselves and placing funds into professionally managed life insurance funds for prudent retirement planning.
(HK stocks quote is delayed for at least 15 mins.Short Selling Data as at 2026-06-05 16:25.)

Related NewsCiti: Assuming Zero New Non-HK Resident Mainland Account Openings, Forecast 2028 HSBC HOLDINGS (00005.HK), STANCHART (02888.HK) PBT Only Down About 2%

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