Has the Eagle Landed Hong Kong?

For about a century, New York was the world’s financial capital. A listing in New York was considered a status symbol by Asian companies. And then Asia decided it was time to rise and shine. It found its footing in the world economy and began making big news. And Hong Kong thought, “How does a bite of the big apple taste like?”

With several factors in play, Hong Kong’s capital market gained prominence. The number of new listings surged 34% year-on-year to 86 in 2007.

“With the support of the central government, Hong Kong’s capital market will retain its leading position as a fund-raising hub for international capital,” Asia Times quoted PricewaterhouseCoopers’ assurance partner Richard Sun. “The number of IPOs is likely to rise to 90 this year,” Sun added.

Going backward a few years, while 24 big international IPOs took place in 2005, only one of them was in New York. In fact, the world’s largest IPO ever was achieved by China’s ICBC (Industrial and Commercial Bank of China), which was listed in Hong Kong and Shanghai, raising almost US$22 billion. “ICBC! ICBC!” (I Can’t Believe it’s China! I Can’t Believe it’s China!)

Like New York, Hong Kong also experienced a lull in IPOs earlier this year, though the situation seems to have rebounded. One of the noteworthy IPOs was the new listing of China Railway Construction Corp in the first quarter, which raised US$2.34 billion. While Hong Kong hasn’t overtaken New York, it’s definitely giving its bigger rival a solid run for its money. Let’s see how big or small an impact the credit crunch will spill to Asia in months to come.