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SFC Issues Guidelines Limiting IPO Margin Lending to 90%
Recommend 9 Positive 13 Negative 4 |
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The Securities and Futures Commission (SFC) issued a circular last night (20th) on IPO subscription and financing services, limiting IPO margin lending to a maximum of 90% and requiring compliance with investor identification requirements under FINI. According to the SFC's guidelines, for IPO subscription orders that clients do not pre-fund in full, licensed corporations (LCs) are expected to collect from the clients upfront subscription deposits of 10% of the subscription amounts. In addition, LCs should evaluate their own financial and liquidity capabilities as well as the creditworthiness of their clients when providing IPO financing to clients. The guidelines also reminded LCs to ensure that the client identification data (CID) submitted to FINI for IPO subscriptions is accurate, while adhering to the waterfall requirements of FINI. AAStocks Financial News |
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