The Budapest Stock Exchange [BSE] signed a Cooperation Agreement with one of the largest stock exchanges of the world, the Shanghai Stock Exchange. The two organisations will work together among other things on creating new products available for both Hungarian and Chinese investors. This is another step for the BSE towards a closer cooperation with the dynamically growing Chinese capital market.
The BSE and the Shanghai Stock Exchange signed an agreement that opens the door for wide cooperation. Within the frames of the newly launched partnership the two stock exchanges will develop investment products together, also they initiate a joint research activity. The cooperation also includes exchange of information on the capital market, stock market operation and regulation.
With this signing the BSE started a cooperation with one of the five largest stock exchanges in the world (the Shanghai Stock Exchange is at the fourth to fifth place in annual aggregates). On the Shanghai Stock Exchange more than 1400 companies’ shares are traded, its daily average turnover is bigger than the entire Hungarian market capitalisation.
The Shanghai Stock Exchange was founded in 1990, it operates in the form of a non-profit organisation, governed directly by the China Securities Regulatory Commission (CSCR), the Chinese securities market supervision. The exchange is one of China’s two independent stock exchanges besides Shenzen, both markets provide wide range of shares, bonds and other securities.
The witnesses of the signing ceremony were Mr. Fang Xinghai, Vice Chairman of CSCR and és Mr. László Windisch, Deputy-Governor of the Central Bank of Hungary.
A key element of the capital market development activity of the Budapest Stock Exchange is to strengthen the cooperation with dynamically developing China. In January 2017, the BSE signed a similar Memorandum of Understanding with the Bank of China which could effectively promote among other things, the presence of yuan-based tradable products on BSE.
The Far East has dominated the global IPO scene since 2014, on the Shanghai and Shenzen stock exchanges in 2017 only, there were 436 public equity issues, a quarter of the new IPOs worldwide. In terms of the total value of transactions in both 2017 and 2016 the Shanghai Stock Exchange was the world leader.