Hong Kong's stock issuance market is booming, but the basic underwriting fees of investment banks have significantly decreased.

Despite a strong rebound in the Hong Kong stock issuance market, investment banks' underwriting fees have hit the lowest level in years. According to capital market data provider LSEG, companies listing in Hong Kong are paying banks an average of 1.5% of the funds raised, the lowest level since 2000. In comparison, the average underwriting fee over the past 25 years is 2.3%, and 2.4% in the Asia-Pacific region this year. As some transactions have not been priced this month, the final data may change. The main reason is the surge in the number of mainland-listed companies seeking a secondary listing in Hong Kong. These transactions, known as "A+H listings," have significantly lower underwriting fees compared to traditional initial public offerings (IPOs). The average underwriting fee for "A+H listings" this year is 0.9%, while the average fee for a standard IPO is 2.2%.