FINANCE

Hong Kong Warns IPO Sponsors Over Slipping Application Quality

Published: Dec. 10, 2025 5:04 p.m. GMT+8

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Hong Kong’s financial regulators have issued rare joint warnings to IPO sponsors over declining listing application quality, urging banks to address irregularities that they say could erode the overall standard of companies seeking to go public.

Both the Securities and Futures Commission (SFC) and the Hong Kong Stock Exchange (HKEX) confirmed to Caixin that they had issued letters to sponsors.

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Hong Kong’s SFC and HKEX jointly warned IPO sponsors about falling listing application quality, citing weak documentation, poor regulatory responses, and execution failures.
As of December 7, KPMG reported HKEX had 316 active and nearly 400 total IPO applications, causing sponsor overload and submission issues.
Regulators threatened application returns, delayed listings, review suspensions, or disciplinary actions if standards do not improve.

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Who’s Who

Securities and Futures Commission: The Securities and Futures Commission (SFC) is a financial regulator in Hong Kong. It has issued joint warnings with the Hong Kong Stock Exchange to IPO sponsors regarding declining listing application quality. The SFC has observed weak drafting, inadequate responses to queries, and execution failures. They have returned some applications and may return more.

Hong Kong Stock Exchange: The Hong Kong Stock Exchange (HKEX) has issued joint warnings with the SFC to IPO sponsors regarding declining listing application quality. They expressed concern over weak drafting, inadequate responses, and execution failures. The HKEX is currently handling a historic backlog of nearly 400 listing applications, and warns that failure to improve could lead to suspended reviews or disciplinary actions for sponsors.

KPMG: KPMG data indicates that the Hong Kong Stock Exchange (HKEX) was managing 316 listing applications as of December 7, with the number approaching 400 when including confidential filings. This significant volume contributes to a historical backlog, and regulators attribute the poor quality of submissions, in part, to sponsors being overloaded.

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