Severe Weather Trading (SWT) : How Financial Institutions and Market Participants Should Prepare

The Hong Kong Exchanges and Clearing Limited (HKEX) implemented the Severe Weather Trading (SWT) policy on September 23, requiring securities and derivatives markets to maintain trading and operations during extreme weather conditions. HKEX has emphasized that, while ensuring orderly market operations under the new arrangements, market participants should not provide services to the public at physical locations. Instead, they should adopt remote working models and offer online services to prioritize personal safety. How, then, should financial institutions and market participants prepare to ensure uninterrupted business operations?

Ensuring Business Continuity: The Necessity of Remote Trading for Financial Institutions

Remote working has become increasingly prevalent in recent years. Surveys indicate that approximately 80% of financial institutions have significantly reduced disruptions to trading activities during past adverse weather events by implementing effective digital remote working solutions. However, as financial institutions and market participants handle substantial data transmission and trading activities, the security and stability of systems supporting remote operations are critical. Technology solution providers currently offer tailored solutions for financial institutions, utilizing technologies such as Point-to-Site (P2S) VPN, Site-to-Site (S2S) VPN, and Virtual Desktop. These enable employees to securely and reliably connect to online trading platforms from any location, ensuring uninterrupted trading.

Collaboration with Third-Party Providers: Ensuring System Compatibility and Continuity

Numerous enterprise solution providers offer comprehensive solutions to help financial institutions and market participants comply with the new SWT policy. However, businesses must ensure that their internal systems are compatible with third-party technical solutions and can be securely integrated. Additionally, they should evaluate the provider’s technical team’s ability to support the development of contingency measures for potential technical issues. As a leading global financial hub, Hong Kong’s financial services sector must demonstrate robust and flexible adaptability to address unforeseen challenges. To ensure seamless financial trading during adverse weather, financial institutions should consider partnering with technology solution providers to develop customized solutions tailored to their needs. I firmly believe that, through the application of technology, financial institutions can effectively manage unexpected situations, delivering uninterrupted, high-quality services to their clients. 

Written by: Steve Ng, Managing Director of Commercial Group, HKT

Source: EDigest