Download Hong Kong Exchanges and Clearing Limited下载香港交易及结算所有限公司.pptVIP

Agenda Background Guide on Book Closure Guide on Trading Arrangement Background What are corporate actions? Corporate actions (CA) are events initiated by a listed company that affects the rights attaching to the company’s issued shares. Some events are simple, mandatory and no action is required from shareholders (e.g. cash dividend) while others are more complex, optional and a response from shareholders is required (e.g. rights issue, privatisation). Background What are corporate actions? Purpose of a corporate action can be: Distribute income (e.g. cash or stock dividend, bonus issue) Raise capital (e.g. rights issue, open offer) Restructure issued capital (e.g. share subdivision/consolidation, warrant exercise) Reorganise the company (e.g. spin-off, takeover and privatisation) Background Why CA disclosure so important? A corporate action may affect how the securities are traded in the secondary market and may trigger operational tasks to: the stock exchange (e.g. adjusting previous day closing price on ex-date or setting up temporary trading counter for NPR); the clearing house / stock depository (e.g. setting calendar for entitlements, adjusting stock master file, collecting and distributing entitlements to account holders) the brokerage firms / custodian banks / nominee companies (e.g. adjusting internal systems and taking appropriate actions to protect the interest of its customers’ stock portfolio and ensure funds flows in good order) To protect shareholder interests and to ensure the orderly trading of the company’s shares in the secondary market, it is important for issuers to schedule the corporate actions properly and to disclose timely, accurate and adequate information about their corporate actions. Background Consequences of inappropriate CA disclosure Incomplete, unclear or delayed information about a corporate action will expose shareholders and the market to risks of market confusions, affecting the fair and orderly trading of the respective