HKEx takes Lehman hit, holds onto top spot in derivatives warrants turnover

Hong Kong Exchanges and Clearing (HKEx), the holding company for both the Stock Exchange of Hong Kong and the Hong Kong Futures Exchange, has held onto its position as the world's number one exchange, chief executive Paul Chow said on Wednesday.

The stock exchange also remains the third largest in the world in terms of market capitalisation, despite a 50% fall in its market value to HK$10.3 trillion.

HKEx reported profit attributable to shareholders of HK$5.1 billion ($657 million), a fall of 17% over the previous year. Revenue sank 12% to HK$7.5 billion. Profit was pulled down by a loss of HK$155 million incurred following the default of Lehman Brothers Securities Asia (LBSA).

While average daily turnover on the exchanges fell 18% to HK$72 billion, trade in options and futures contracts climbed 19%. Average daily trade in the call bull-bear contracts (CBBC) soared to 14 times the 2007 level. The combined average daily turnover of CBBC and derivatives warrants accounted for 25% of total market turnover, exchange executives said. This was largely due to a nine-fold increase in CBBC products to 4.231 products at the end of 2008, from 391 in 2007. Of the total, more than 3,000 were issued on two Hong Kong indexes and 1,100 were issued on single Hong Kong stocks.