HKEX INVESTOR PRESENTATION

Aug 2020

2

Disclaimer

The information contained in this document is for general informational purposes only and does not constitute an offer, solicitation,

invitation or recommendation to subscribe for or purchase any securities, or other products or to provide any investment advice or service

of any kind. This document is solely intended for distribution to and use by professional investors. This document is not directed at, and is

not intended for distribution to or use by, any person or entity in any jurisdiction or country where such distribution or use would be

contrary to law or regulation or which would subject Hong Kong Exchanges and Clearing Limited (“HKEX”) to any registration

requirement within such jurisdiction or country.

This document contains forward-looking statements which are based on the current expectations, estimates, projections, beliefs and

assumptions of HKEX about the businesses and the markets in which it and its subsidiaries operate. These forward-looking statements

are not guarantees of future performance and are subject to market risk, uncertainties and factors beyond the control of HKEX. Therefore,

actual outcomes and returns may differ materially from the assumptions made and the statements contained in this document.

Where this document refers to Shanghai-Hong Kong Stock Connect and/or Shenzhen-Hong Kong Stock Connect (together, the “Stock

Connect” programs), please note that currently, access to northbound trading is only available to intermediaries licensed or regulated in

Hong Kong; southbound trading is only available to intermediaries licensed or regulated in Mainland China. Direct access to the Stock

Connect is not available outside Hong Kong and Mainland China.

Where this document refers to Bond Connect, please note that currently, access to northbound trading is only available to foreign

investors that are able to trade onshore bonds on the China Foreign Exchange Trade System & National Interbank Funding Centre.

Although the information contained in this document is obtained or compiled from sources believed to be reliable, HKEX does not

guarantee the accuracy, validity, timeliness or completeness of the information or data for any particular purpose, and shall not accept

any responsibility for, or be liable for, errors, omissions or other inaccuracies in the information or for the consequences thereof. The

information set out in this document is provided on an “as is” and “as available” basis and may be amended or changed. It is not a

substitute for professional advice which takes account of your specific circumstances and nothing in this document constitutes legal

advice. HKEX shall not be responsible or liable for any loss or damage, directly or indirectly, arising from the use of or reliance upon any

information provided in this document.

3

Agenda

2

1 Key Performance and Growth Drivers

Group Financial Update

Strategic Plan 2019-2021

Appendix

Financial supplement

3

5

China Connectivity4

4

HKEX – Leading Vertically Integrated Exchange Group

Note: Figures for FY2019 (unless otherwise stated)

1. Corporate items accounted for 8% of total revenue in 2019 and are not shown on this slide.

HKEX GROUP

Leading diversified exchange group in the Asian Time Zone

HK’s only exchange group

World’s leading IPO venue – ranked #1 in 7 of the past 11 years

Pioneer in Mainland capital markets connectivity

London Metal Exchange – globally leading base metals exchange

REVENUE:

HK$16.3bn

EBTIDA:

HK$12.3bn

PAT:

HK$9.4bn

EPS:

HK$7.49

DPS:

HK$6.71(90% payout)

Cash EquitiesEquity & Financial

DerivativesCommodities

TechnologyPost Trade

Primary & Secondary Markets Post Trade Market Access

2019

Revenue

Share1

22% 18% 9% 38%5%

Market Data

FY2019

REVENUE:

HK$8.8bn

EBTIDA:

HK$6.7bn

PAT:

HK$5.2bn

EPS:

HK$4.15

DPS:

HK$3.71(90% payout)

1H 2020

Financials

5

1H 2020 Key Highlights

Record half-yearly revenue and profit despite challenging macroeconomic backdrop with core

business revenue up by 13%YoY; total revenue up by 2%YoY and PAT up by 1%YoY

Record half-yearly Stock Connect revenue of HK$743mn (+46%YoY)

Net investment income fell $681mn, primarily due to the fair value losses of collective investment

schemes previously announced at Q1

Strong IPO Market – #2 globally in number of new company listing (64) and #3 in IPO funds

raised (HK$ 92.8bn)

Strong performance in Connect Schemes – all achieved half-yearly record high ADT

Major licensing agreement for MSCI Asia & EM indexes to offer suite of 37 new contracts, further

expanding HKEX product ecosystem

Ongoing market microstructure enhancements and technology capabilities enhancement

6

21.830.0 33.9

25.216.4

36.6 40.1

17.1

110 122138 126

174

218

183

0

50

100

150

200

250

0

20

40

60

80

100

120

Source: HKEX, Dealogic.

1. Shanghai-HK and Shenzhen-HK Stock Connect was launched in Nov 2014 and Dec 2016 respectively.

2. Buy + Sell ADT.

3. 2020 YTD as of Jul 2020.

Broad Product Ecosystem Attracting Diverse Mainland and International Investor Base

Transformational Growth from China’s Opening1IPOs Driving ADT Growth

Southbound Connect

Jumbo IPOs

Global Investors

Risk Management

Algo / Quant Investors

After-hours Trading

6369

106

67

88

107

87

125

2018

2017

2013

2014

2015

2016

2019

+5.7%

2013

2014

2019

2016

2017

2015

2018

762

533 577

768869

1,2041,068+12.3%

Futures OptionsCAGR

CAGR

2019

2017

2015

2016

2018

6 5 1020

42

+60.0%

2019

3

2015

2016

2017

2018

410

1311

+33.5%

Northbound ADT2

(RMB billion)

Southbound ADT2

(HK$ billion)

CAGR CAGR

Total IPO funds raised (US$ billion)

# of IPOs

New Economy Listing

Reforms

• Biotech

• WVR

• Secondary Listings

Strong Pipeline of

Mainland and

International Listings

Global fundraising rank Continuing Portfolio

Diversification

A-share Inclusion in

Global Benchmarks

SB Connect Limited by

Investor Eligibility Cap

Securities ADT

(HK$ billion)

Derivatives ADV

(’000 contracts)

A

B C

Focus on Revenue Growth and Cost DisciplineD

Core Business Well-Positioned for Organic and Structural Growth

2020

YT

D

2020

YT

D

3 3

87

2020

YT

D

2020

YT

D

23

3 3

2016

2013

2018

2014

2017

2015

2019

Global fundraising rank

2020

YT

D

3

88

#3 #2 #1 #1 #3 #1 #1 #3

1,210

7

Diverse International Investor Base Attracted to Broad Product Ecosystem

1. HKEX signed a licence agreement with MSCI to introduce futures contracts on the MSCI China A Index, subject to regulatory approval and market conditions.

2. HKEX signed a licence agreement with MSCI to introduce 37 futures and options contracts in Hong Kong based on a suite of indexes in Asia and Emerging Markets, subject to regulatory approval and

market conditions (33 already launched in Jul and Aug 2020).

Short

Selling

Stock

Options Stock

Futures

DWs

CBBCs

Index

Futures

OTC

ETPs Currency

Futures

Stock

Connect

Bond

Connect

A-share

Derivatives1

Stocks

Recent initiatives and future focus

Market microstructure enhancements: leading to better price

discovery and trade efficiency

Targeted marketing and client support: onboarding 10+ clients

each year

Incentives: driving increased volumes

Product cross-selling: creating arbitrage opportunities

Algo / Quant Participation in Cash Market

Due to…

• Presence of stamp duty

• Minimal high frequency trading

• Single market structure

Relatively low(circa. 10-20% of ADT)

Algo / Quant Participation in Derivatives Market

Relatively high(circa. 30-40% of ADV)

Driven by…

• No stamp duty

• Market maker participation

• Capital efficiency

A

Asia & EM

Index Futures2

8

Internationalising Hong Kong’s Product Offering Key Dynamics

Reinforces Hong Kong’s role as the leading global market in the Asian Time Zone

Expanding our product UNDERLYING

licenced a suite of MSCI indexes in Asia and Emerging

Markets to introduce 37 futures and options contracts

(33 already launched as of Aug 2020)

Broadening and deepening LIQUIDITY

Allow investors to Trade Asia, in Asia

Complement existing HSI and HSCEI index futures

Enhancing our COMPETITIVENESS

Better capital efficiency

Creating a competitive one-stop shop for China and

Asian exposures

New MSCI Suite - Growing Product Ecosystem to Connect Global TradesA

* Also include MSCI Taiwan (USD) Index Options

Index

Futures

NTR Index

Futures

MSCI Australia Net Total Return (USD) √

MSCI China Free (USD) √ √

MSCI Emerging Markets (USD) √ √

MSCI EM ex China Net Total Return (USD) √

MSCI EM ex Korea Net Total Return (USD) √

MSCI EM Asia Net Total Return (USD) √

MSCI EM Asia ex China Net Total Return (USD) √

MSCI EM Asia ex Korea Net Total Return (USD) √

MSCI EM EMEA Net Total Return (USD) √

MSCI EM LatAm Net Total Return (USD) √

MSCI Hong Kong Net Total Return (USD) √

MSCI India (USD) √ √

MSCI Indonesia Index (USD) √ √

MSCI Japan (JPY) √ √

MSCI Japan Net Total Return (USD) √

MSCI Malaysia (USD) √ √

MSCI New Zealand Net Total Return (USD) √

MSCI Pacific Net Total Return (USD) √

MSCI Pacific ex Japan Net Total Return (USD) √

MSCI Philippines (USD) √ √

MSCI Singapore Free (SGD) √

MSCI Singapore Free Net Total Return (USD) √

MSCI Singapore Net Total Return (USD) √

MSCI Taiwan (USD)* √ √

MSCI Thailand (USD) √ √

MSCI Vietnam (USD) √ √

91. YTD Data from 1 Jan 2020 to 30 Jun 2020

ACTIVE ETFS

MARKET MAKER BUY-IN

EXEMPTION

INTRODUCE ICSD SETTLEMENT

MODEL

-2X INVERSE PRODUCTS

DESIGNATED SPECIALISTS

CONTINUOUS QUOTING AND

NEW SPREAD TABLE (JUN)

$4.5B

$5.0B

$7.1B

2018

2019

2020

ADT

ADT

ADT 1

LOWER

TRADING COSTS

IMPROVED

MARKET QUALITY

DEEPENED

LIQUIDITY POOL

GREATER

PRODUCT DIVERSITY

OFC

STRUCTURE

A-SHARE L&I PRODUCTS (JUL)

MARKET MAKER

STAMP DUTY EXEMPTION (AUG)

ETP – A Growing Contributor along with Market Structure EnhancementsA

Our aspiration is to become Asia’s ETP Marketplace

10

Source: Dealogic, as of July 2020.

1. Include Non-18A Biotech companies

2. Only include Chapter 18A Biotech companies

Strongly Performing IPO Market boosted by New Economy Issuers and

Secondary Listings

B

No. of IPO

– Total

– New Economy1

– Biotech2

IPO Funds Raised by Segments

IPO Funds Raised

(HK$ bn)

2020 Jan - July Fundraising Summary

174 218 183

14 27 38

0 5 9

World’s second-largest fund raising hub for

biotech companies

Dialogue with the Biotech Community 2020

webinar series with PhiRDA - attracted 292,000+

views

HKEX Biotech Week 2019 – attended by 1,000+

scientists, biotech entrepreneurs, investors,

technology experts and policymakers

Ongoing listing reforms

Shortening of IPO settlement cycle

Enhancing listing regime for overseas issuers

Enhancing the bookbuilding and price discovery

aspects of IPOs (cornerstone investors, pricing

flexibility, clawback mechanism)

IPO Funds Raised

(#3 globally)22 New Economy

& Biotech Companies Listed…

…raising

HK$94.8bn

+56%YoY +212%YoY

HK$132.1bn

0

100

200

300

2017 2018 2019 2020 YTD

Others Biotech New Economy

128.5

288.314.

88

16

6

132.1

11

14 Jumbo IPOs > US$1bn (HK$7.8bn) since Jan 2018

Rank Company name IPO dateIPO size

(HK$bn)

1 Alibaba Group - SW 26/11/2019 101.20

2 China Tower - H 08/08/2018 58.80

3 Budweiser Brewing APAC 30/09/2019 45.08

4 Xiaomi Corporation - W 09/07/2018 42.61

5 Meituan Dianping - W 20/09/2018 33.14

6 JD.COM - SW 18/06/2020 34.56

7 Netease - S 11/06/2020 24.26

8 ESR Cayman Ltd. 01/11/2019 14.06

9 Shenwan Hongyuan - H 26/04/2019 9.09

10 Hansoh Pharmaceutical Group 14/06/2019 9.04

11Topsports International

Holdings10/10/2019 9.01

12Ping An Healthcare and

Technology04/05/2018 8.77

13 Jiangxi Bank - H 26/06/2018 8.60

14 WuXi AppTec - H 13/12/2018 8.28

3.3

9.2

20.1

20192018 2020 YTD

Cash Market ADT (HK$ bn) contributed

by the Jumbo IPOs and related Structured Products ADT

Rising contribution to volumes from Jumbo IPOs

% of respective ADT

Source: HKEX, as of Jul 2020.

Ranked by IPO size.

% of single stock option ADV

3.0%

10.5%

16.1%

1.3%

7.3%

13.3%

Jumbo IPOs Contributing to Increased Trading ActivityB

In 2020, 16% of cash ADT and 13% of stock option ADV is contributed by the top 14 IPOs over the last 2.5 years

12

0

100

200

300

400

500

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

Source: HKEX, Bond Connect, ChinaBond, SCH;

1. Shanghai-HK and Shenzhen-HK Stock Connect was launched in Nov 2014 and Dec 2016 respectively.

2. Foreign participation in CIBM was first allowed in 2010 when the PBOC rolled out a Pilot Scheme to allow foreign financial institutions to invest in CIBM.

3. Data as of Jul 2020 (unless otherwise specified).

Benefiting from the increased capital flow into and out of Mainland China,

in particular inbound flows driven by international index inclusions

Stock Connect1 Bond Connect

20

18

20

17

20

15

20

19

20

16

125 186

531668

1,429+84.0%

20

18

20

15

20

16

20

17

20

19

115

364

927789

1,138

+77.3%

Northbound(RMB billion)

Southbound(HK$ billion)

Portfolio Value Portfolio Value

Total Foreign Participation in CIBM2

(RMB billion)

Bond Connect

launch

Foreign Holdings in Chinese Bonds

(US$ bn)Foreign

Ownership (%)

US$382bn

2.8%

Continuing portfolio diversification by Mainland and

international investors

Inclusion of A shares into major global benchmarks

Increasing selection of new economy companies in

Southbound Stock Connect

Inclusion of Mainland bonds into global fixed income

indices

Easier access to the Mainland bond market via more

trading platforms

Increasing use of RMB globally and need to reinvest

into RMB assets

Investors

Onboarded

>2,060

YTD ADT

RMB19.8bn

CAGRCAGR

Transformational Growth from China’s OpeningC

20

20

1,536

20

20

1,951

333

13

Revenue (HK$ million) EBITDA (HK$ million)

2013-2016 2016-2019

Stock Connect – Shanghai

After-hours trading

LME fee commercialisation

Launch of LME Clear

ADT re-rating

Stock Connect – Shanghai + Shenzhen

Continuing growth in derivatives

Listing reforms and new economy issuers

Revamped investment income approach

8,7239,849

13,37511,116

13,180

15,867 16,311

20182013 2014 20172016 20192015

+8.4%

+13.6%CAGR

5,946 6,891

10,0857,661

9,61411,757 12,263

20162013 20192014 2015 2017 2018

+8.8%

+17.0%

EBITDA

Margin

CAGR

68% 70% 75% 69% 73% 74% 75%

Focus on Revenue Growth and Cost DisciplineD

Reaping rewards from the structural growth initiatives that have already been implemented

141. If the impact of HKFRS 16 were excluded, 2019 Operating Expense would be HK$4,362 million and the 2016-2019 CAGR would be 8.1%.

Operating Expenses (HK$ million) Profit Attributable to Shareholders (HK$ million)

2013-2016 2016-2019

Investment in growth initiatives to capture

China opportunities

Upgrading core infrastructure to strengthen

technological foundation

Reaping rewards of past investments and

benefiting from operating leverage

Increased cost discipline

Investment in automation and operational

efficiency

2,777 2,9583,290 3,455 3,566

4,110 4,048

2013 2014 201720162015 2018 2019

+7.6%

+5.4%CAGR

CAGR

4,552 5,165

7,956

5,7697,404

9,312 9,391

2013 2014 2015 20182016 2017 2019

+8.2%

+17.6%

1

Net Profit

Margin52% 52% 59% 52% 56% 59% 58%

Focus on Revenue Growth and Cost DisciplineD

Increased operating leverage from revenue growth, delivered by structural drivers combined with opex discipline

15

Continued focus on Organisational Excellence and Corporate Sustainability

Progressing our financial markets and communities for the benefit of all

OUR MARKETS

Update of ESG Reporting Guide

with online training materials

Active involvement in global ESG

standardisation consultations

New ‘Sustainable Finance’ MD

appointment to lead commercial

sustainability proposition

Announcement of HKEX STAGE,

the first-of-its-kind sustainable and

green finance information platform

in Asia

OUR PEOPLE

Official launch of HKEX Foundation with

flagship $20 million Charity Partnership

Programme

New university scholarship programme

to support home-grown talents

COVID-19 HK$10m relief fund through

HKEX Foundation in HK, China and UK

Enhanced Diversity & Inclusion efforts

e.g. FT Women in Business Programme,

CarER partnership and HKUST MBA

“Diversity in Business” course

sponsorship

OUR OPERATIONS

Enhanced Risk, Operations,

Communications and Continually Policy

Newly launched ‘paper reduction’

programme as part of HKEX Green

Month

HKEX Future Workplace Programme

Launch of new CSR website

Awarded Sustainability Leader status in

S&P Global’s Sustainability

Yearbook 2020 and Bloomberg Gender

Equality Index

TALENT ENGAGEMENTRISK CULTUREREPUTATION

16

Agenda

1 Key Performance and Growth Drivers

Strategic Plan 2019-2021

Appendix

Financial supplement

3

5

China Connectivity4

2 Group Financial Update

17

1H 2020 Key Financial Highlights

EBITDA PAT

Core business revenue Net investment income

(HK$)

+13%

$7.1bn

1H 2019

$7.9bn

1H 2020

-45%

$1.5bn

1H 2019

$0.8bn

1H 2020

+1%

$6.6bn

1H 2019

$6.7bn

1H 2020

+1%

$5.2bn

1H 2019

$5.2bn

1H 2020

$8.6bn

1H 2019

$8.8bn

1H 2020

+2%

Total revenue & other income

Margin

77% 76%

-0%

$4.16 $4.15

Basic earnings per share

1. % is computed based on amounts reported in financial statements.

2. The 2020 first interim dividend will be payable in cash, without a scrip alternative.

3. Does not add up due to roundings.

Record half-yearly revenue and profit

Strong core business performance; market conditions impacted investment income

-0%

$3.72

1H 2019

$3.71

1H 2020

Dividend per share2

18

income Basic earnings per shareOperating

expenses (1) EBITDAProfit attributable to HKEX

shareholders (2)

Staff costs from HC mainly

from BayConnect acquisition &

payroll adj

IT costs from new IT systems

and network upgrade

Professional fees from

strategic projects and business

initiatives

EBITDA margin 1% PAT % similar to EBITDA EPS due to shares issued for

scrip dividends

Revenue and

other income

Trading & clearing fees from

ADT and record Stock Connect

revenue

Listing fees from record newly

listed CBBCs

Net Investment income (NII)

due to HK$138mn losses from

external portfolio in 1H 2020 (vs

HK$535mn record gains in 1H

2019)

1H 2020: Record Half-Yearly Revenue and Profit

1. Excludes depreciation and amortisation, finance costs, and share of profits/(losses) of joint ventures

2. For the purpose of this presentation, tax impact of NII is not considered when calculating the PAT attributable to NII.

Core business7,059

Core business7,944

Core business5,106

Core business5,868

Core business3,686

Core business4,395 Core business

2.95

Core business3.49

NII 1,519 NII 838

NII 1,519 NII 838

NII 1,519 NII 838

NII 1.21NII 0.66

8,578 8,782

1,953 2,076

6,625 6,706

5,205 5,233

4.16 4.15

1H 2019 1H 2020 1H 2019 1H 2020 1H 2019 1H 2020 1H 2019 1H 2020 1H 2019 1H 2020

ADTMargin77% 76%

HK$97.9bn +20% HK$117.5bn

+ 6%Core business+NII

+ 1%

Core business

+ 19%

Core business

+ 15%

Core business+NII

+ 2%

Core business+NII

+ 1%

Core business

+ 13%

(HK$ mn)

Core business+NII

- 0%

Core business

+ 18%

(HK$)

19

Revenue and other income

NII due to rebound of external portfolio (Q2: HK$383mn gains; Q1: HK$521mn losses)

Depository, custody and nominee service fees due to seasonality

Partly offset by:Trading and clearing fees from ADT & ADV

Operating expenses (1) EBITDAProfit attributable to

HKEX shareholders (2)

Stable opex due to stringent cost control EBITDA margin 4% PAT % higher than EBITDA due to one-off deferred tax charge in Q1 2020

Q2 2020: Quarterly Record High Due to Rebound of External Portfolio and

Seasonality

1. Excludes depreciation and amortisation, finance costs, and share of profits/(losses) of joint ventures

2. The tax impact of NII is not considered when calculating the PAT attributable to NII.

Core business4,056

Core business3,888 Core business

3,031Core business

2,837 Core business2,309

Core business2,086

NII (47)

NII 885

NII (47)

NII 885

NII (47)

NII 885

4,009

4,773

1,025 1,051

2,984

3,722

2,262

2,971

Q1 2020 Q2 2020 Q1 2020 Q2 2020 Q1 2020 Q2 2020 Q1 2020 Q2 2020

HK$114.0bnHK$120.9bnMargin 78%74%

- 6%

ADT

+ 3% Core business+NII

+ 31%

Core business

- 10%

Core business

- 4%

Core business

- 6%

Core business+NII

+ 19%

Core business+NII

+ 25%

(HK$ mn)

20

Trading fees & tariffs

from ADT of

equity products,

trading days, and

record Stock

Connect trading

revenue

Trading fees & tariffs

from DWs, CBBCs &

warrants from

ADT

Trading fees from

futures and options

from proportion

of higher fee

contracts traded

Listing fees due to

record half-yearly

newly listed CBBCs

Trading fees

from LME fee

increase

Clearing fees

from ADT & SI,

record Stock

Connect clearing

revenue and LME

Clear fee increase

Accommodation

income due to

JPY & EUR

collateral by CPs in

HK and USD

investment return of

LME Clear fell below

benchmark

Network fees

due to usage of

the Orion Central

Gateway and China

Connect Central

Gateway by EPs

Hosting services

fees due to

subscriptions

NII of Corporate

Funds from external

portfolio (HK$138mn

losses in 1H 2020 vs

HK$535mn record

gains in 1H 2019)

Segmental revenue

Higher Revenue across All Business Segments, Offsetting External Portfolio

Loss of HK$138mn (versus a Record Gain of HK$535mn in 1H 2019)

(HK$ mn)

1. Headline ADT up 20% (1H 2020: HK$117.5bn; 1H 2019: HK$97.9bn); ADT of cash equity up 33% (1H 2020: HK$100.0bn; 1H 2019: HK$75.1bn); ADT of DWs, CBBCs and warrants included under equity and

financial derivatives down 23% (1H 2020: HK$17.5bn; 1H 2019: HK$22.8bn)

Change year-on-year

%

(685)

390 7 55 367 708,578 8,782

YTD Q2 2019 Cash Equity Equity andFinancial

Derivatives

Commodities Post Trade Technology Corporate Items YTD Q2 20201H 2019 1H 2020

-91%+21% +0% +8% +11% +19% +2%

21

Trading fees & tariffs from

ADT of equity products,

trading days, and record

Stock Connect trading

revenue

Opex due to lower

allocated costs of Listing

division due to proportion

of listing fees from equities

Trading fees & tariffs from DWs,

CBBCs & warrants from

ADT

Trading fees from futures and

options from

proportion of higher fee

contracts traded

Listing fees due to record half-

yearly newly listed CBBCs

Opex due to higher allocated

costs of Listing division due to

listing fees from DWs and

CBBCs

Trading fees from LME

fee increase

Opex due to IT

maintenance expenses,

partly offset by marketing

expenses

Clearing fees from ADT

& SI, record Stock Connect

clearing revenue and LME

Clear fee increase

Other revenue from

accommodation income

Opex due to staff costsfrom payroll adjustment

Overall EBITDA margin

1% due to fair value losses

on external portfolio of

HK$138mn (vs record gains

of HK$535mn in 1H 2019)

Network fees due to

usage of the Orion Central

Gateway and China Connect

Central Gateway by EPs

Hosting services fees due

to subscriptions

Opex due to inclusion of

BayConnect opex (1)

1. The acquisition of BayConnect was completed in June 2019 and its opex is included under Technology segment.

Resiliency and Performance reflected in EBITDA

Cash EquityEquity & Financial

DerivativesCommodities Post Trade Technology

Group Total

(incl. Corp. Items)

(HK$ mn)

+ 26% - 1% +14% + 12% + 12% + 1%

Share of Group EBITDA (before Corporate Items)%

EBITDA Margin%

1,5611,340

370

2,842

271

6,625

1,968

1,331 420

3,197

304

6,706

24% 27% 21% 19% 6% 6% 45% 44% 4% 4%

1H 2019 1H 2020 1H 2019 1H 2020 1H 2019 1H 2020 1H 2019 1H 2020 1H 2019 1H 2020 1H 2019 1H 2020

100% 100%

84% 87% 82% 81% 53% 56% 87% 88% 73% 69%

77% 76%

22

535

210

729

45

(138)

204

714

58

1H 2020: HK$838mn (1H 2019: HK$1,519mn)

Income from Internal Funds in line YoY despite increase in margin

rebates to participants

Average Margin Fund and Clearing House Fund sizes increased

due to heightened volatility in 1H 2020 (in particular March)

(HK$ mn)

Net investment income by category of investments

Debt

securities

Collective

investment

schemes

Cash &

bank

depositsFX

923

55

535

6

982

32

(138)(38)

Investment Income – External Portfolio Impacted by Broader Market; Income

from Internal Funds Held Up Well

Average fund size

12.2 16.3

130.1151.7

26.7

29.3 Corporate Funds

Margin Funds

Clearing HouseFunds

1H 2019 1H 2020

169.0

197.3

(HK$ bn)

Net investment income by funds

(HK$ mn)

Corporate Funds (External Portfolio)

Margin

Funds

Corporate Funds (Internal)

Clearing

House Funds

1H 2019 1H 2020 1H 2019 1H 2020 1H 2019 1H 20201H 2019 1H 2020 1H 2019 1H 2020 1H 2019 1H 20201H 2019 1H 2020 1H 2019 1H 2020

23

Point of Injection / Redemption Cumulative gain since inception (HK$ mn)

External Portfolio – Annualised Return of 5.1% since Inception

As the market rebounded in Q2 2020, the external portfolio partially recovered from the Q1 2020 loss,

resulting in a cumulative gain of $1.2bn or an annualised return of 5.1% since inception.

1. HKEX added HK$2bn to the portfolio during the period from Q4 2018 to Q2 2019.

2. HK$3.3bn was redeemed in 1H 2020.

400

420

440

460

480

500

520

540

560

580

600

1000

1500

2000

2500

3000

MSCI World Index Bloomberg Barclays Global Agg Bond Index

2017:

+23.4%MSCI World

Return (Net):

2018:

-8.6%

1H 2020:

-6.3%2019:

+27.1%

HK$6bn

injection

HK$2bn

injection(1)

HK$3.3bn

redemption(2)

638

1,321

1,183

0

200

400

600

800

1,000

1,200

1,400

2017

532

800

2016 1H

2020

2018 2019

24

Agenda

1 Key Performance and Growth Drivers

Group Financial Update

Appendix

Financial supplement

3

5

China Connectivity4

2

Strategic Plan 2019-2021

25

Our 2019-2021 Strategic Vision

Global

Markets

Global

Liquidity

China

Markets

Global

Underlying

China

Liquidity

China

Underlying

Globally ConnectedChina Anchored Technology Empowered

Facilitating China’s

internationalisation and

investment diversification

Bringing global liquidity

to China and Asia Pacific

underlying

Leveraging new technology

for modernisation and

growth

The Global Markets Leader in the Asian Time Zone –

Connecting China, Connecting the World

26

Expand Northbound capital inflows 1

2 Expand Southbound capital

allocation

3Expand post-trade

infrastructure

CHINA ANCHORED

Key Objectives

Bond Connect: addition of Bloomberg as second access

platform; >2,050 investors onboarded; market

infrastructure enhancements

Corporate WVR: market consultation launched on

Corporate WVR Beneficiaries

Southbound investor ID: launched in Jan 2020 to facilitate

orderly operation and regulation of Stock Connect

MSCI China A Futures: signed agreement with MSCI,

pending regulatory approval

Strategic Plan 2019-2021

QME: introduced 5 products within first year of launch;

licenced to launch natural gas products in Jun 2020

Stock Connect: inclusion of Xiaomi and Meituan Dianping

in Southbound; announced inclusion arrangements of

A+H companies for STAR companies

Achievements to Date

Northbound Master SPSA: launched in Jul 2020 to

facilitate more efficient pre-trade checking of Northbound

sell orders and average pricing execution at the fund

manager level

27

Enhance our product ecosystem

across asset classes1

3

2Improve our market

microstructure

Expand our international footprint

further

GLOBALLY CONNECTED

Derivatives Market: after-hours trading extended to 3am;

MSCI Asia & EM Index futures & options; enhanced block

trade facilities; more new stock options

ETP market structure: cross-listing link with Euroclear;

buy-in exemption; new spread table and continuous

quoting market making; waiver on stamp duty on stock

transfers for ETP market markers

ETP product suite: launched first active equity ETF, -2x

Inverse ETP, iron ore futures ETF, commodity-based L&I

Product, A-share L&I Product

Derivatives & structured products: Inline Warrants; Weekly

Index options; Indian Rupee Currency Futures

Commodities: 6 gold indexes and USD London Metal Mini

Futures for 6 base metals in HK; 7 new cash-settled metals

futures on the LME; USD and CNH Silver Futures launched

in Jun 2020; LME launched new rules to optimise

warehousing network

IPO regime: ongoing initiative to shorten IPO settlement

cycle; Alibaba paperless IPO (T+4 settlement)

International listings: Budweiser APAC and ESR Cayman

Strategic Plan 2019-2021

Cash Market: expansion of closing auction session; launched

Volatility Control Mechanism (VCM); enhancements to Pre-

opening Session (POS) to be implemented in Q4 2020

Key Objectives Achievements to Date

28

Modernise core systems 1

3

2 Leverage new technology

Expand our horizons

Core enhancements: Derivatives market platform upgrade;

new Stock Connect trading system (OTP-CSC)

Client Connect: phase 1 rollout; Initiating phase 2 for

further digitisation on multiple processes and forms

Operational efficiency: continue to progress on delivery of

robotic process automation across divisions; shortened

the listing cycle of structured products

Technology resources: 51% acquisition of BayConnect

(Ronghui Tongjin); launched ‘Aiden’, HKEX’s first virtual

assistant

Virtual bank: Fusion Bank received HKMA licence, in

preparation for launch in 2020

TECHNOLOGY EMPOWERED

Strategic Plan 2019-2021

Data strategy: minority investment in Huakong TsingJiao

Key Objectives Achievements to Date

29

2019-2021 Strategy – FICC Themes

FIXED INCOME AND CURRENCY COMMODITIES

Facilitate CNY access

Enhance Bond Connect

Expand suite of offshore rates / FX

derivatives on onshore underlying

Build post-trade infrastructure(custody, settlement, collateral management, FX)

Expand product suite

Pricing evolution

Mainland China warehouses

Commodity Connect

30

Key Components of Our FIC Strategy

Expand Existing Platform

Capture CNY Opportunities

Invest in Post-Trade Infrastructure

Bond Connect enhancements

Listed bonds and derivatives

Southbound Bond Connect

CNY accessibility – repository, tracking and monitoring

IRS and repo + Derivatives Connect

CNY trading platform

Custody, settlement and collateral management

Trade repository and monitoring

International linkages

31

475

584 634

676 700

670 619 624

730 697

668

0

200

400

600

800

1,000

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 1H

ADV (‘000 lots)

LME Group Integration Process Complete…

6 Dec 2012

HKEX

acquisition

22 Sep 2014

LME Clear

Launch

Post-acquisition

integration and

LME Clear launch

Commercialisation

of the platform

with LP and new

trader programme

Strategic pathway, future

platform development and

revised fee structure

Source: LME data as of Jun 2020

1. Excluding Admin Trades, 2020 YTD: 622,435 lots.

32

…and LME Strategic Development on Track

• Continuing the success of the Strategic

Pathway

• New contracts continue to build liquidity,

especially across ferrous suite

• 2020 prioritisation of electronic options market

to simplify and standardise areas of its market

structure

Strategic Pathway

• Continued embedding of responsible sourcing requirements into the LME brand lists, ensuring that LME

brand listing is a clear indicator of good ethical standing

• Launch of 2020 sustainability strategy proposals to reflect market interest in broader sustainability story

with a focus on low carbon aluminium

Sustainability focus

• Significant investment in new trading platform

• Supporting industry initiatives to enhance

security of off-warrant metal storage

• Investigating solutions to enable the spot

trading and sourcing of specific metal types

• Insourcing warrant depository to streamline

the warrant lodgement and withdrawal

process, and provide significant operational

efficiencies

Continued innovation

• Promoting the highest standards of fair and orderly trading on the LME’s market

• Delivery of off-warrant stock reporting to provide better industry-wide metals stock transparency

• Opening a market discussion as to acceptable practices for commodities trading going forwards

Market leadership

33

Agenda

1 Key Performance and Growth Drivers

Group Financial Update

Appendix

Financial supplement

3

5

4

2

Strategic Plan 2019-2021

China Connectivity

34

The Penetration Level of Equity Market through Stock Connect

Source: Wind, HKEX

1. Data as of Jun 2020.

Stock Connect Coverage(% of all Mainland & HK listed companies)

36%

32%

19%

% of domestic market included in Stock Connect

MUTUAL MARKET

80%

81%

85%

70%

64%

89%

By

Market

Cap

By

Turnover

By

Number

Stock Connect covers the majority of the market by market cap and turnover

78%of total market cap

70%of total turnover

29%of total number of

companies

SSE

SSE

SSE

SZSE

SZSE

SZSE

475

579

706

35

6.5 11.8 7.9 5.1 4.0 3.1 3.6 4.2 4.2 5.7 6.2 9.8 13.8 13.8 12.4 15.3 24.6 30.3 21.4 21.6

31.3 40.3 39.8 30.2 29.8 34.9

72.3

-- - - - - - 1.7 2.2 4.0 4.8

7.7 10.1 11.0 9.7 10.8

21.1 26.6

21.4 23.9

37.0

53.9 52.9

40.9 42.2 51.3

93.7

1.4 7.4

2.8 1.9 2.4 2.9 5.0 4.5 6.0 6.7 7.9 9.1

13.2 8.0 6.2 5.3

7.5 6.8

6.3 6.9

9.6

12.3 15.6

10.1 11.2

10.5

18.9

0.5 1.1 1.5 2.6

4.0

6.5 5.0

3.7 3.0

4.3 3.8

3.6 4.3

6.8

8.3 10.2

8.0 8.6

9.7

17.2

7.9 19.2

10.7 6.9 6.4 6.0 8.6 10.9 13.5 17.9 21.6 30.6

43.6

37.8 32.0 34.4

57.4 67.5

52.8 56.8

84.7 114.8

118.6

89.2 91.9

106.3

202.1

0.8%

2.2%

1.4% 1.3%1.7%

2.3%

3.7% 3.9%

4.8%5.3%

5.7%6.1%

6.8%

6.1%5.4% 4.8%

5.8%5.6%

6.4%7.3%

7.9%

9.0%9.1%

9.0%8.7% 8.0%

10.9%

-5.00%

-3.00%

-1.00%

1.00%

3.00%

5.00%

7.00%

9.00%

11.00%

0

50

100

150

200

1Q 15 2Q 15 3Q 15 4Q 15 1Q 16 2Q 16 3Q 16 4Q 16 1Q 17 2Q 17 3Q 17 4Q 17 1Q 18 2Q 18 3Q 18 4Q 18 1Q 19 2Q 19 3Q 19 4Q 19 Jan 20 Feb 20 Mar 20 Apr 20 May 20 Jun 20 Jul-20

NB record of

RMB191.2bn on

7 Jul 2020

SB record

of HK$60.2bn

on 6 Jul 2020

Stock Connect Northbound and Southbound Trading ADT reached RMB74.3bn and HK$20.7bn in 1H 2020

Stock Connect Average Daily Trading Volume (HK$ billion)

Stock Connect revenue continued to set record highs, reaching 8 per cent

of the Group’s total revenue and other income in 1H 2020 (1H 2019: 6 per cent)

Shenzhen Southbound

Shanghai Northbound (1)

Shenzhen Northbound (1)

Shanghai Southbound

Stock Connect generated record revenue of HK$743m in 1H 2020, 46% higher than 1H 2019 (Full Year 2019: HK$1,009m)

Total average daily trading volume

Percentage of Southbound turnover of Hong Kong Market

Stock Connect – Trading Trends

Source: HKEX, SSE and SZSE as of 31 Jul 2020

1. Northbound (NB) trading is conducted in RMB; The NB figures in the chart are converted to HKD based on the month-end exchange rate.

2. Does not add up due to roundings

36

1,437 1,439

1,298

1,450

1,518

1,687

1,952

785

951

1,033

1,050

932

1,043

1,054

1,094

1,160

1,2211,264

1,429

601 576 566 592

686 662698 680

719

621679 668

202233 253 270

301347 366

404437

491 502530

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Stock Connect (Northbound)

Source: HKEX

1. Data as of Jul 2020.

Portfolio Value

RMB billion

4.7

9.6

20.4

41.7

86.7

34.731.7

77.3

84.3

124.3

2016 2017 2018 2019 2020YTD

31 May2018

31 Aug2018

28 May2019

27 Aug2019

26 Nov2019

MSCI

rebalancing

days

Average Daily Turnover

2018

2017

2019

RMB billion

2020

37

251 207

432

812 884

1,136

17 17 31 96 106

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020YTD

Index Futures on China Underlying

Hang Seng Index Futures (50)3 HSCEI Futures (50)3

ADV (’000 contracts)

NOTIONAL VALUE1

US$156kNOTIONAL VALUE1

US$62k

FTSE China A50 Index Futures (SGX) (50)3 CSI 300 Index Futures (CFFEX) (300)3

NOTIONAL VALUE1

US$14kNOTIONAL VALUE1

US$176k

2

WEIGHTING COMPOSITION1

45%55%

Source: HKEX, SGX, CFFEX, FIA

1. As at Jun 2020.

2. CSI 300 Index Futures was launched in Apr 2010.

3. Numbers in brackets represent the number of constituents within the underlying index.

MAINLAND CHINA

Trading Fee: RMB27.78/contract, 0.0023% to notional value

Trading Fee: HK$3.50/contract, 0.0006% to notional value

Trading Fee: US$0.80/contract, 0.0056% to notional value

85 94 83 80 69 86

131 127

234 209

186

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020YTD

50 61 65 86 89

135 134 117

152 139

159

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020YTD

2 12 39

84

159

369

270 260

339 391 385

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020YTD

OTHER

Trading Fee: HK$10.00/contract, 0.0007% to notional value

38

0

25

50

US China Japan UK FR

Tapping into China’s Vast Bond Market

Source: CBIRC (Mar 2019), World Bank, PBOC, BIS, IMF

Bank Assets Equities Bonds

US$39tn

US$6tn

US$13tn

International

Investors

China’s Bond

Market

Key Policy Drivers

• Risk migration from banking sector to bond market

• Greater credit differentiation amid ongoing market

reforms

• Funding needs for economic transition and

infrastructure projects – e.g. Belt & Road; Panda

bonds

• Enhanced bond issuance and disclosure standards

Growing International Demand

• Yield differential against developed markets

• Inclusion in emerging market bond indexes

• Geographical and asset class diversification

• Growing convertibility of RMB / SDR inclusion

• More efficient access – Bond Connect

Outstanding,

US$ tn Relative to GDP

201%

96% 247%

163%205%

39

0

100

200

300

400

500

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

Pilot scheme

to access

CIBM

RQFII

investment

QFII

investment

Long-only

investment

Bond

Connect

launch

68%64%

46%41% 39% 38%

29%

13%8%

~2%

DE FR AU UK IT CA US RU JP China

Growth DriversForeign Participation in the CIBM

Average: 38.5%15%

Achievable

target

Foreign Ownership %

US$382bn

Foreign Holdings in Chinese Bonds

(US$ billion)

Foreign Ownership (%)Inclusion of Mainland bonds in global fixed income

indexes (6% of Bloomberg index weighting by 2020)

Greater adoption of RMB globally and

need to reinvest in RMB assets

Improving access to the Mainland bond market

Bond Connect Has Significantly Grown Foreign Participation in China’s Bond MarketBond Connect Jul 2020 YTD ADT: RMB 19.8bn

Source: ChinaBond + SCH, Bloomberg, BIS

1. Foreign participation in the CIBM data as of Jul 2020

Foreign participation in the CIBM increased by 217% since launch of Bond Connect in July 2017(1)

Number of Bond Connect participants has grown to 2,068 as of Jul 2020

2.8%

(1)

(1)

40

Agenda

1 Key Performance and Growth Drivers

Group Financial Update

3

5

4

2

Strategic Plan 2019-2021

China Connectivity

Appendix

Financial supplement

41

Financial Highlights – Income Statement

(HK$ mn, unless stated otherwise) 1H 2020% of Revenue &

Other Income1H 2019

% of Revenue &

Other IncomeYoY Change

Results

Revenue and other income 8,782 100% 8,578 100% 2%

Operating expenses (2,076) (24%) (1,953) (23%) 6%

EBITDA 6,706 76% 6,625 77% 1%

Depreciation and amortisation (545) (6%) (495) (6%) 10%

Operating profit 6,161 70% 6,130 71% 1%

Finance costs and share of profits less losses of

joint ventures(57) (1%) (80) (1%) (29%)

Profit before taxation 6,104 70% 6,050 71% 1%

Taxation (870) (10%) (847) (10%) 3%

(Profit)/loss attributable to non-controlling interests (1) (0%) 2 0% N/A

Profit attributable to HKEX shareholders 5,233 60% 5,205 61% 1%

Capex 519 368 41%

Basic earnings per share HK$4.15 HK$4.16 (0%)

Headline ADT on the Stock Exchange HK$117.5 bn HK$97.9 bn 20%

1. % does not add up due to roundings.

42

Performance by Operating Segment

HK$ mnCash

Equity

Equity &

Financial

Derivatives

CommoditiesPost

TradeTechnology

Corporate

Items

Group

1H 2020

Group

1H 2019

Revenue and other income 2,253 1,638 749 3,629 443 70 8,782 8,578

% of Group Total 26% 19% 8% 41% 5% 1% 100% 100%

Operating expenses (285) (307) (329) (432) (139) (584) (2,076) (1,953)

EBITDA 1,968 1,331 420 3,197 304 (514) 6,706 6,625

% of Group Total (1) 29% 20% 6% 48% 5% (8%) 100% 100%

EBITDA margin 87% 81% 56% 88% 69% N/A 76% 77%

Depreciation and amortisation (60) (51) (169) (106) (22) (137) (545) (495)

Finance costs (7) (6) (4) (46) (1) (32) (96) (86)

Share of profits less losses of

joint ventures 39- - - - -

39 6

Profit before taxation 1,940 1,274 247 3,045 281 (683) 6,104 6,050

1. % Share of Group EBITDA (including Corporate Items).

43

Staff costs due to

annual payroll

adjustments and

headcount arising

from acquisition of

BayConnect in June

2019

Operating Expenses and Depreciation – Investment in Talent, Infrastructure

and Strategic Initiatives

Staff costs and

related expenses

due to maintenance

expenses for new IT

systems and network

upgrades, and costs

from BayConnect

No significant change Professional fees

incurred for strategic

initiatives and consulting

fee for HKATS review

due to new and

renewed office leases,

and roll-out of new IT

systems

IT & computer

maintenance exp

Premises

expenses

Professional

fees

Other operating

expenses (1) Total opex

No significant change

(HK$ mn)

1. Includes product marketing and promotion expenses

+ 78%+ 5% + 13% - 8% - 3% + 10%

1,328 1,398

278 315

64 59 37 66

246 238

1,9532,076

495 545

1H 2019 1H 2020 1H 2019 1H 2020 1H 2019 1H 2020 1H 2019 1H 2020 1H 2019 1H 2020 1H 2019 1H 2020

Depreciation and

amortisation

1H 2019 1H 2020

+ 6%

Total opex due to

staff costs, IT costs and

professional fees

44

1,575

2,5202,330

1,5311,432

1,553 1,543

1,241

1,716 1,777

2,0331,878

2,5622,479 2,443

1,828

2,608 2,597

2,207

1,979

2,262

2,971

2,796

4,057

3,747

2,775

2,751

2,879

2,848

2,638

3,048

3,155

3,4543,523

4,1504,044 4,102

3,571

4,288 4,290

3,9873,746

4,009

4,773

718862 881 829 854 834 834

933833 878 887

968 935 983 1,025 1,167970 983 949

1,146 1,025 1,051

2,078

3,195

2,866

1,946 1,8972,045 2,014

1,705

2,215

2,2772,567

2,555

3,2153,061 3,077

2,404

3,318 3,307

3,038

2,600

2,984

3,722

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2

Profit attributable to shareholders

Revenue and other income

Operating expenses

EBITDA

(1)

1H 2020 Performance above Historical Trendline

2015

Quarterly performance

(HK$ million)

1H 2020 performance reflects resiliency of core business

despite macroeconomic and COVID-19 induced uncertainty.

1. Excludes depreciation and amortisation, finance costs, share of profits/(losses) of joint ventures, and non-recurring costs arising from the proposed combination with London Stock Exchange Group (LSEG)

2. Dotted trend lines are illustrative and do not constitute a forward forecast.

2016 2017 2018 2019 2020