Acting SFST Highlights Growth in Asset Management at 2026 AIMA APAC Annual Forum

Speech by Acting SFST at AIMA APAC Annual Forum 2026

Following is the speech by the Acting Secretary for Financial Services and the Treasury, Mr Joseph Chan, at the Alternative Investment Management Association (AIMA) Asia-Pacific (APAC) Annual Forum 2026 today (October 29):

Jack (Chief Executive Officer of the AIMA, Mr Jack Inglis), Mike (Managing Director and Co-head of APAC, AIMA, Mr Michael Bugel), Kher-sheng (Managing Director and Co-head of APAC, AIMA, Mr Lee Kher-sheng), distinguished guests, industry leaders, ladies and gentlemen,

Good morning. It is my great pleasure to join you all today at the AIMA APAC Annual Forum 2026. Let me first extend my sincere gratitude to AIMA for organising this remarkable forum, and extend a very warm welcome to all the policymakers, regulatory leaders, alternative investment management thought leaders, and members of the AIMA community who have gathered here from across the region. As we navigate a complex and rapidly changing global landscape, today's forum provides a vital platform to address the key regulatory, policy, and operational focus areas anticipated for Asia-Pacific managers.

Under the unique "one country, two systems" principle, Hong Kong is the only city in the world that converges both the China advantage and the global advantage. Under "one country", we enjoy preferential access to the Chinese Mainland market, including the Stock Connect, Bond Connect, Wealth Management Connect and the mutual recognition of funds. Under "two systems", Hong Kong's core competitiveness includes the free flow of capital, our common law system, a simple and low tax regime, and a regulatory regime fully compatible with those of major international markets.

These distinctive advantages position Hong Kong as the "super connector" and "super value-adder" between China and the international markets, and between the East and the West. Today, Hong Kong stands as a premier global platform across key asset classes. We proudly rank third in the world and first in Asia under the Global Financial Centres Index.

This solid foundation translates directly into extraordinary market dynamism and resilience. According to the latest annual survey by the Securities and Futures Commission (SFC), total assets under management (AUM) of Hong Kong's asset and wealth management business reached a record high of HK$42.2 trillion, or approximately US$5.4 trillion, at the end of 2025, registering a 20 per cent year-on-year increase. The net fund inflows coming into Hong Kong last year surged by 193 per cent year-on-year to reach HK$2.1 trillion, or US$265 billion. These figures vividly demonstrate Hong Kong's undisputed status as Asia's premier asset and wealth management hub for international investors.

Furthermore, the AUM of Hong Kong's private equity (PE) funds amounted to US$250 billion as of June 2026, ranking second in Asia by scale, only trailing the Chinese Mainland market in the region. We welcome alternative asset funds to list in Hong Kong to promote further growth of our market. The SFC issued a circular in February 2025 to clarify the regulatory requirements for authorising alternative asset funds (e.g. funds investing in PE, private credit, infrastructure equity or debt, etc), thereby encouraging these funds, preferably sizeable ones with regular income streams, to list in Hong Kong. In May 2025, the Mandatory Provident Fund Schemes Authority clarified that MPF (Mandatory Provident Fund) funds may invest in approved listed private equity funds.

With vibrant private equity and venture capital activities in the city, the development of our Limited Partnership Fund (LPF) regime of Hong Kong has reached a significant milestone. Since its launch in August 2020, the LPF regime has been met with strong market enthusiasm, with accelerating growth in recent years. The number of LPFs registered in Hong Kong surpassed the 2 000 mark August this year, and reached almost 2 100 at the end of September. The regime has successfully facilitated the channelling of capital to Hong Kong's private equity and venture capital market, generating demand for financial and related professional services, such as legal, accounting and custodian sectors.

We have also cemented our position as the world's largest cross-boundary wealth management centre, and Asia's largest hedge fund hub. Projections indicate that from 2025 to 2030, cross-boundary wealth managed in Hong Kong will grow by an average of 9 per cent annually, keeping us firmly at the leading position globally.

We do not take our success for granted, and we understand that there is no room for complacency. We recognise that maintaining our competitive edge requires continuous dialogue and close partnership with the industry, and for this, I must extend my heartfelt thanks to AIMA and our many industry partners for your invaluable guidance and constructive feedback over the years.

In direct response to industry feedback, we have taken decisive legislative action to sharpen our edge. In June 2026, we introduced the Bill into the Legislative Council (LegCo) to further enhance the preferential tax regimes for funds, single family offices, and carried interest. This bill introduces several key enhancements. It expands the scope of funds eligible under the tax exemption regime to include pension funds, endowment funds, and specific funds-of-one. It also increases the types of qualifying investments eligible for tax concessions for funds and single family offices, covering emission derivatives and allowances, insurance-linked securities, loans and private credit investments, digital assets, precious metals, and specified commodities. It also further enhances the tax concession arrangements for carried interest. These enhancements are designed with a clear objective: to attract an even greater concentration of global funds, alternative investment managers, and family offices to establish and expand their long-term presence in Hong Kong. I am pleased to share that this bill is currently undergoing scrutiny by the Legislative Council's Bills Committee, with the clause-by-clause examination already completed. The Government targets to resume the second reading debate on the Bill by end of this year. Subject to passage by the LegCo, these enhanced, competitive tax concession measures will take effect starting from the year of assessment 2025/26.

Last month, the Chief Executive announced the First Five-Year Plan for Economic and Social Development of the Hong Kong Special Administrative Region, which stated that, we are committed to promoting the development of our fund market by diversifying the range of asset classes under management and product offerings, including diversified asset management instruments such as alternative asset funds and real estate investment trusts (REITs), thereby deepening and broadening our overall asset and wealth management capabilities.

Indeed, we will introduce a bill this year to enable the privatisation or restructuring of real estate investment trusts, followed by another bill in the first half of 2027 to provide a stamp-duty waiver for the transfer of non-residential properties into REITs seeking a listing. Concurrently, the SFC is streamlining its procedures to attract high-quality overseas REITs for dual listing in our market, and will revise relevant codes next month to actively promote product innovation in fund products and broaden investor choices. We are also continuing our proactive efforts to seek the early inclusion of REITs under mutual-market access schemes.

Ladies and gentlemen, our commitment to the asset management industry is steadfast and long term. We will continue to walk hand in hand with the industry, listening to your insights, refining our regulatory and tax framework, and sharpening our competitive edge as a world-leading international asset and wealth management centre.

I wish today's AIMA APAC Annual Forum 2026 resounding success, and I wish all of our overseas and local guests a most rewarding and inspiring conference. Thank you.

The Acting Secretary for Financial Services and the Treasury, Mr Joseph Chan, delivers opening keynote address at the Alternative Investment Management Association Asia-Pacific Annual Forum 2026 today (October 29). Source: HKSAR Government Press Releases

Statement by ExCo Non-official Members

The following is issued on behalf of the Executive Council Secretariat:

Non-official Members of the Executive Council (ExCo Non-official Members) today (October 29) issued the following statement on the Government's follow-up work in relation to the fire at Wang Fuk Court:

The Hong Kong Special Administrative Region (HKSAR) Government today released the report of the Independent Committee in relation to the fire at Wang Fuk Court in Tai Po. The Chief Executive and Principal Officials also held a press conference to give an account of relevant matters to the public. ExCo Non-official Members expressed full support for the Government in facing up to the problems, shouldering responsibility, and pursuing comprehensive reforms.

The Convenor of ExCo Non-official Members, Mrs Regina Ip, said, "The Chief Executive and Principal Officials have clearly explained to the public the Government's follow-up work, and, on behalf of the HKSAR Government, apologised to the residents of Wang Fuk Court and the community, demonstrating sincerity and political commitment. The Chief Executive also called on his team to continue to give their utmost in their respective positions in pressing ahead with various reforms and the extensive work ahead, while drawing lessons from the incident and better exercising leadership to step up the implementation of the result-oriented governing approach. I support this position."

"The Government's plans to implement comprehensive reform on the basis of the Independent Committee's report are comprehensive and pragmatic, addressing the crux of the issues. I concur with the seven major directions of systemic reform put forward by the Government. These include combatting bid-rigging in building maintenance and renovation projects, establishing a cross-departmental task force to combat crimes related to bid-rigging in such projects, establishing a Building Maintenance Support and Services Council, reforming the operation and regulatory system for building maintenance and renovation, reforming the structure of the Buildings Department, establishing a centralised data system and reforming the complaint mechanism, and establishing a steering committee chaired by the Chief Secretary for Administration to follow up on the Independent Committee's recommendations."

As regards accountability, the Government has demonstrated its determination to pursue responsibility comprehensively and enforce accountability at various levels. On criminal liability, law enforcement authorities have successively instituted prosecutions against the companies and individuals involved in the incident. The Government has also initiated the Administrative Responsibility Two-tier Investigation Mechanism under the Heads of Department Accountability System, and is strictly following up on the administrative responsibility of the civil servants concerned. As for political accountability, the Chief Executive, having considered a wide range of factors, decided that the Secretary for Housing should take political accountability, and has accepted the Secretary's resignation.

The fire at Wang Fuk Court has exposed a number of long-standing inadequacies at different systemic levels, and the issues involved are complex and intertwined. Properly addressing these issues requires firm resolve as well as precise and decisive decision-making. ExCo Non-official Members will give their full support to the Government in taking forward comprehensive reforms and will continue to fully support its governance. ExCo Non-official Members firmly believe that, as long as society works together with dedication to turn grief into the strength to move forward, learns from the experience, and thoroughly implements systemic reforms, similar incidents can certainly be prevented, making Hong Kong a safer and better home.