Hong Kong Exchange Fund posts highest-ever income in 2025

The Hong Kong Exchange Fund posted its highest-ever income of 331 billion dollars last year.

While some lawmakers suggested increasing the payout to the public coffers, the Hong Kong Monetary Authority said the Financial Secretary determines the amount based on maintaining monetary stability.

Separately, HKMA will grant the city's first batch of stablecoin issuer licenses in March.

The city's Exchange Fund earned 331 billion dollars last year -- the highest since the HKMA was set up in 1993.

It contributes 16.5 billion dollars to the government fiscal reserves, up 3.3 billion dollars from 2024.

During a Legco meeting, some legislators questioned if the payout could be raised to fund the government's capital account.

"The government still needs to issue bonds to build infrastructure," said Ng Kit-chong, of the Election Committee Constituency. "There is cost to issuing bonds. There is also an interest rate. Will the HKMA take this into consideration?

"Will some more returns go back to the public coffers from the Exchange Fund so as to lower the cost for taxpayers?"

"There is a standing mechanism in place," responded Eddie Yue, chief executive of the HKMA. "We look at the investment returns over the past six years to distribute the returns or we use the Exchange Fund bill over the past three years to determine the amount of money that should be distributed to the public coffers."

"Should there be more income going back to the public coffers, this is decided by the Financial Secretary. But this has to be done under the premise that it will not affect the current stability of Hong Kong."

The panel discussion also covered regulations on cryptocurrencies. Since introducing a stablecoin regulatory framework last year, the HKMA has received 36 license applications.

Having completed an initial review, the regulator is requesting supplementary information from candidates to finalise the assessment.

Yue stated that while the HKMA aims to issue the first batch of licenses by March, the priority remains prudence over speed.

Speaking of Beijing's strict stance on stablecoin, Yue noted that any licensed institution engaging in cross-border business must adhere to local rules.

Addressing HSBC's widespread system outage on Friday, Yue believes it was caused by an internal system problem, instead of a cyberattack.

The HKMA had instructed HSBC to conduct a review and implement measures to prevent similar incidents.