HKEX INVESTOR PRESENTATION

10 March 2017

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.

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

Agenda

2

1 HKEX Group Financial and Market Update

HKEX Strategic Plan 2016-18

China Connectivity Update

Appendix

3

4

4

2016 – Key Highlights

Source: HKEX

Source: HKEX

Political and economic uncertainties continue to impact investment sentiment

Increase in futures volumes and strict cost control lessened impact of fall in HK cash market’s activity

Globally #1 in IPO funds raised, despite lower total proceeds

Shenzhen – Hong Kong Stock Connect launched on 5 December 2016

Excluding 2015 one-off gains, PAT down 22% compared to exceptional results in 2015

5

8 7 10 16 18

34

88

72 62

69 70

54 63

69

106

67 70

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017 Y

TD

64 111 214

282 302

525 591

427

642

859

490

305 379

943

1,115

490

26

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017 Y

TD

IPO Follow On

2016 Volumes Reflect Market Uncertainties

Source: HKEX & LME data

(1) 2017 YTD as of 28 Feb 2017

237 234 286 283 312

345 369

446 442 475

584 634

676 700 670 619 633

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017 Y

TD

44 45 62 80 104 174

359 432 398

468

572 488

533 577

769 762 755

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017 Y

TD

Futures Options

Securities ADT (HK$ billion) Derivatives ADV (’000 contracts)

Total Funds Raised (HK$ billion) Commodities ADV (’000 lots)

(1) (1)

(1) (1)

6

Trading and clearing fees

on ADT in Cash and

ADV in Commodities but

partly offset by ADV on

HKFE

One-off gains of $514m in

2015 (sale of LCH, sale of

WWH and Lehman payment)

income Basic Earnings per

Share

- 17% + 5% - 24% - 27% - 29%

Highlights – 2016 Annual Results

Prior year comparison

13,375

11,116

3,290 3,455

10,085

7,661 7,956

5,769

6.70

4.76

2015 2016 2015 2016 2015 2016 2015 2016 2015 2016

($)

Operating

Expenses(1) EBITDA

Profit Attributable to

HKEX Shareholders

Costs control while continuing with strategic

projects

Headcounts and annual payroll adjustments but

partly offset by variable pay

Premises expenses due to

new offices

One-off Lehman recovery of $77m in 2015

EBITDA margin 6%

( 5% excluding one-off

items)

PAT more than EBITDA due

to increased D&A but partly

offset by reduced finance

costs following conversion of

convertible bonds

(one-off items of $566m

in 2015)

$105.6bn

ADT

- 37% $66.9bn

% decrease higher than PAT

due to shares issued for

convertible bonds in Q2 2015

and scrip dividends

+ 3%

(excluding one-off item)(2)

- 22%

(excluding one-off items)(2)

- 14%

(excluding one-off items)(2)

- 19%

(excluding one-off items)(2)

- 24%

(excluding one-off items)(2)

(1) Excludes depreciation and amortisation, finance costs, and share of loss of a joint venture

(2) One-off items in 2015: LCH: An exceptional gain on the sale of investment in shares of LCH.Clearnet Group Limited of $31m; WWH: A one-off gain on sale of Worldwide House

property of $445m; Lehman payment: A one-off post liquidation interest from liquidators of Lehman Brothers Securities Asia Limited (Lehman) of $38m; Lehman recovery: A one-off

recovery from the liquidators of Lehman of $77m, reducing opex in that period

($ million)

Revenue and Other

Income

Margin 75% 69%

7

Trading fees & tariff

from ADT (2016: $50.2bn;

2015: $79.9bn)

Listing fees due to

listed companies and

forfeited fees from

withdrawn applications

Costs for strategic

initiatives

Listing fees due to

newly listed DWs and

CBBCs

Trading fees

due to ADT of DWs &

CBBCs and

ADV of stock options

ADV on HKFE

Costs flat

Trading fees from

ADV (2016: 619k;

2015: 670k), increased

incentive rebates and fee

reduction

Costs for new premises

and strategic projects

Clearing fees due to

volumes on SEHK and

LME, investment income,

and one-off Lehman

payment of $38m in 2015

Costs due to recovery

from Lehman of $77m in

2015, partly offset by

staff costs, legal &

professional fees and

depreciation of GBP

Overall EBITDA margin

6%

Network usage fees due

to participants migrating to

Orion Central Gateway.

Offset by throttle sales

Hosting services fees

due to number of racks

taken up by customers

2,904

1,733 1,189

4,310

351

10,085

2,139 1,593

963

3,436

388

7,661

- 26% - 8% - 19% - 20% + 11% - 24%

Performance by Operating Segment

EBITDA

Cash Equity Equity & Financial

Derivatives Commodities Clearing

Platform &

Infrastructure

Group Total

(incl. Corp. Items)

Share of Group EBITDA (before Corporate Items)

%

28% 25%

EBITDA Margin

85% 80% 80% 78% 69% 62% 86% 83% 70% 72%

75% 69%

17% 19% 11% 11%

41% 40%

3% 5%

2015 2016 2015 2016 2015 2016 2015 2016 2015 2016 2015 2016

($ million)

%

8

(1,799)

269

(50)

(231)

(448)

Trading fees and trading tariff Trading fees and trading tariffallocated to Clearing segment

Clearing and settlement fees Stock Exchange listing fees

Market data fees Other revenue One-off items

2016

Revenue Movement by Market(1)

($ million)

Cash(2) HKFE Futures

and Options Commodities Others Stock Options

Drop in Cash and Commodities partially offset by increase in Futures.

Demand for risk management products reflects continued volatility as well as increasing Mainland participation

(3)

2015

Revenue

13,375

(1) Data shown in this slide has been regrouped into five categories based on the 2016 consolidated financial statements

(2) Includes all products traded on the Stock Exchange (ie, equity products, DWs, CBBCs and warrants)

(3) Includes depository, custody and nominee services fees, net investment income, other revenue and sundry income but excludes one-off items above

Includes one-off gains of $514m

in 2015

(WWH:$445m, Lehman

payment:$38m and LCH:$31m)

Revenue

11,116

9

1,158 1,170 1,200 1,024

1,178 1,189 1,287

1,511 1,575

2,520

2,330

1,531 1,432

1,553 1,543

1,241

2,222 2,218 2,134 2,149

2,335 2,286

2,471

2,757 2,796

4,057

3,747

2,775 2,751

2,879 2,848 2,638

669 672 677 759 734 689

753 782 718

862 881 829 854 834 834 933

1,553 1,546 1,457 1,390

1,601 1,597 1,718

1,975 2,078

3,195

2,866

1,946 1,897

2,045 2,014

1,705

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

Profit attributable to Shareholders

Revenue and Other Income

Operating Expenses

EBITDA

2016 2015 2013 2014

(1)

Quarterly Trend

Results in line with historical trend

(1) Excludes depreciation and amortisation, finance costs, and share of loss of a joint venture

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

($ million)

Record 2015 performance distorts view of current results

2016 has returned to the historical trend line and is higher than 2014

Quarterly Performance

10

Agenda

Agenda

2

1 HKEX Group Financial and Market Update

HKEX Strategic Plan 2016-18

China Connectivity Update

Appendix

3

4

11

Our Journey So Far

Mainland China Hong Kong

RMB internationalisation

Progressive two-way capital opening

Expansion of Free Trade Zones

RMB trade settlement and payments

Expansion of direct access: RQFII

Offshore RMB benchmarks

Domestic capital markets develop

Retail investors are the driving force

Derivatives turnover grows quickly

Capital gateway for IPO proceeds

Limited direct access: QFII & QDII

Fast Economic Growth

Privatisation of SOEs

Opening

Up Era 2011-2014

Domestic

Growth Era 2001-2010

IPO Era 1993-2009

Offshore fundraising centre

Segregated from Mainland market

Mutual

Market

Era 2014-

Shanghai- Hong Kong Stock Connect

Shenzhen-Hong Kong Stock Connect

Mutual Recognition of Funds (MOF)

Shanghai- Hong Kong Stock Connect

Shenzhen-Hong Kong Stock Connect

Mutual Recognition of Funds (MOF)

12

Mainland International

Issuers / Products

Issuers / Products

Hong Kong’s Unique Position as a Mutual Price Discovery Venue

WEALTH

MANAGEMENT

CENTRE

RISK

MANAGEMENT

CENTRE

COMMODITIES

PRICING

CENTRE

Investors Investors

13

HKEX’s Strategic Vision

Expanded our asset class reach

Created mutual market access

channels

Enhanced market microstructure

and efficiency

Continued to build and upgrade

systems and platforms

1

2

3

4

Mainland International

Issuers / Products

Issuers / Products

WEALTH

MANAGEMENT

CENTRE

RISK

MANAGEMENT

CENTRE

COMMODITIES

PRICING

CENTRE

Investors Investors

Mainland Investors

International issuers

Commodities capability

Risk management / derivatives

Need to bring:

What have we achieved so far? What is our long-term aspiration?

14

Key Initiatives in Equity, Commodities and FIC

New Benchmark RMB

Derivatives

MOF T-Bond Futures

Currency Options and

Index Futures

New OTC Clear Products

Cross Currency Swaps

FX Forwards, Swaps and

Options

Bond Connect

Grow Core Listing Franchise

GEM Review and New

Board

Extend Mutual Connectivity

ETF Connect

Primary Connect

Expand Derivatives Suite

A-shares Index Futures

Extend Product Complex

LMEprecious

HK – Gold and Iron Ore

Futures

Mainland Commodities

Trading Platform

London-Hong Kong Connect

Delayed by Brexit

EQUITY COMMODITIES FIC

15

Platforms

UPGRADE THE ENGINE Orion Trading Platform (Cash)

Next Gen. Derivatives Platform

Next Gen. Clearing Platform

NEW OPPORTUNITIES Private Market

SERVICE EXTENSION Precious products

Ferrous products

POLICY CHANGE LME Warehousing

NEW VENTURE Qianhai commodities

trading platform

THE

FOUNDATION Data centre

Hosting services

CLIENT FACING

SYSTEMS Orion Market Data

Orion Central Gateway

New Securities Trading Device

ENHANCE

LME

BUILD

LME CLEAR

MARKET DATA

HUB

MAINLAND

TECHNOLOGY

CENTRE

WHAT’S NEXT?

NEW OPPORTUNITIES OTC Clearing

London

Hong Kong

Mainland

16

Business Update

(1) YTD as of 10 March 2017

2016 – 2017 YTD(1)

Successfully launched Shenzhen-Hong Kong Stock Connect

Abolished Aggregate Quota of Stock Connect

Launched new products:

Sector Index Futures

Leveraged & Inverse Products

Mini H-shares Index (HHI) Options

Fourth calendar month contract for HSI and HHI Options

Equities

Completed LME’s warehouse consultation

Launched LMEshield

Announced package of measures to enhance LME market structure

Plan to launch LMEprecious in 1H2017

Setting up Commodities Trading Platform in Qianhai

Commodities

FIC

Market Structures

& Platforms

Launched additional RMB Currency Futures

Co-branded RMB Index Series with Thomson Reuters

Launched USD/CNH Cross Currency Swaps in OTC Clear

Plan to launch new USD/CNH Currency Options on 20 March 2017

Rolled out SPSA Model for Stock Connect enhancement

Launched Closing Auction Session in Securities Market

Launched Volatility Control Mechanism in Securities and Derivatives Markets

Launched Pre-Trade Risk Management System in Derivatives Market

Launched SMARTS Derivatives Surveillance System

17

Key Focus of 2017

ETFs, Listed Bonds

Enhancements: Holiday Trading, SBL, etc.

Bond Connect

Primary Connect

Commodities Connect

Listing Consultation

GEM Review

New Board

Market Quality

Leveraged & Inverse Product Scope Expansion

A-shares Index Futures, subject to regulatory approvals

FICC: RMB T-bond Futures, Gold Futures and Iron Ore

Futures, LMEprecious and Ferrous Products

Orion Trading Platform – Securities Market

Private Market

Commodities Trading Platform in Qianhai

Next Generation Clearing Platform

Enhance Our Listing Regime

Extend and Expand the

Connect Model

Develop New Products

Across Asset Classes

Upgrade Infrastructure and

Explore New Opportunities

18

Agenda

Agenda

2

1 HKEX Group Financial and Market Update

HKEX Strategic Plan 2016-18

China Connectivity Update

Appendix

3

4

19

Evolution of Cross-Border Integration

Mutual market access

Institutional

Quotas QFII / QDII

Issuers A+H Shares

Access

Products ETFs / RQFII

Individual

Flows Shanghai-HK

Stock Connect

Shenzhen-HK

Stock Connect

MRF

RMB Internationalisation

China’s rollout of Mutual Market Access remains on track

20

HKEX Mainland Strategy

Key building blocks

2010 2016

Broadening and

deepening China

Inc. relationships

Trading hours

Listing of Mainland

companies

Infrastructure

Products

TSF

Index development

with SSE and SZSE

Created leverage in

commodities

Mutual market

access across

asset classes

Shanghai-Hong

Kong Stock

Connect

Shenzhen-Hong

Kong Stock

Connect

Relationship

Building

Continued

Harmonisation

RMB

Readiness

CESC JV

LME

Acquisition

China

Connectivity

…

21

Shenzhen NB Connect Shanghai NB Connect

9041 (Main: 253, SME: 428, ChiNext: 223)

RMB 16.7 tri (71%)

RMB 130 bn (55%)

576 (One single board)

RMB 24.3 tri (80%)

RMB 109 bn (57%)

Eligible

Stocks

No.

Mkt Cap

ADT

Removed

RMB 13 bn

None

RMB 13 bn

Agg. Quota

Dly. Quota Quota

Investors Eligibility None ChiNext participation limited to institutional

professional investors initially3

NORTHBOUND

Shenzhen SB Connect Shanghai SB Connect

Eligible

Stocks

No.

Mkt Cap

ADT

Agg. Quota

Dly. Quota Quota

Investors Eligibility

SOUTHBOUND

Removed

RMB 10.5 bn

None

RMB 10.5 bn

RMB 500k RMB 500k

317 (Hang Seng Composite LargeCap, MidCap &

A+H shares not in indices)

HKD 22.0 tri (83%)

HKD 42 bn (86%)

4172

(Hang Seng Composite LargeCap, MidCap, SmallCap

& A+H shares not in indices )

HKD 22.8 tri (87%)

HKD 44 bn (90%)

Estimated data as of end Feb 2017

Key Features of Shanghai & Shenzhen Connect

(1) SZ Northbound: Constituents of SZSE Component & SZSE Small/Mid Cap Innovation indexes with market capitalization of at least RMB 6 bn (average daily market cap in 6 months prior to the periodic review of relevant index, i.e. 1 May 2016 to 31 Oct 2016; to be reviewed half-yearly), and SZSE-SEHK A+H shares (except shares under “risk alert” or delisting arrangement)

(2) SZ Southbound: Constituents of Hang Seng Large & MidCap indexes, constituents of Hang Seng SmallCap index with market capitalization of at least HKD 5 bn (average month-end market cap in 12 months prior to the periodic review of the index, i.e. 1 Jan 2016 to 30 Dec 2016; to be reviewed half-yearly), and SSE-SEHK and SZSE-SEHK A+H shares

(3) Subject to resolution of related regulatory issues, other investors can trade ChiNext stocks listed on Shenzhen Stock Exchange

22

Enlarged and Enhanced Connect Ecosystem

* Note: Eligible shares for the Shanghai & Shenzhen Southbound links are different

* Note: Eligible shares for the Shanghai & Shenzhen Southbound links are different

Stock Connect brings together two different market structures

to facilitate seamless cross-border trading

“Home Market” rules

Leverages existing

infrastructure

Gross order routing

RMB

Super-clearer model

Regulatory cooperation

En

forc

em

en

t Co

op

era

tion

CSRC

SFC

Reg

ula

tory

Co

op

era

tio

n

HKSCC

SEHK

HK Shares

Eligible Shares*

SH A Shares

SZSE

Eligible Shares Eligible Shares

Cle

ari

ng

Lin

k

Cle

ari

ng

Lin

k

SSE/SZSE Members & ChinaClear Participants

Mainland investors

SZ A Shares

SEHK SZ SPV

ChinaClear SZ ChinaClear SH

SSE

SEHK SH SPV

SSE SPV

HK & Overseas investors

Order

Routing

Order

Routing

EPs / CPs

SZSE SPV

MAINLAND

HONG

KONG

23

The Level of Penetration in the Equity Market through Stock Connect

Data as of Aug 2016

* www.szse.cn, www.sse.com.cn, HK data based on HKEX Main Board only

% of all China & HK*

listed companies:

50%

49%

25%

% of listed companies in the mutual market*

MUTUAL MARKET

84%

73%

87%

67%

68%

92%

By

Market

Cap

By

Turnover

By

Number

Shenzhen Connect represents a significantly increased penetration

of China and Hong Kong listed companies

(from 19% under SSE Connect)

(from 83% under SSE Connect)

(from 85% under SSE Connect)

SSE Connect only Including SZSE connect

81% 57%

69% 29%

40% 19%

SSE

SSE

SSE

SZSE

SZSE

SZSE

417

567

880

24

China* 21.5%

China Overseas

5.0%

China A-shares

1.1% KR 14.5%

TW 12.1%

IN 8.2%

SA 7.0%

BR 6.4%

MX 4.0%

RU 3.7%

Others 16.4%

China A-Shares: Projected MSCI Emerging Market Index Inclusion

Roadmap

Source: MSCI – Consultation on China A-shares Index Inclusion Roadmap, Jun 2016. Current Status and partial inclusion do not equal 100% and full inclusion of China shares equals

40.1% due to rounding up. * Including H-shares(HK), Red Chip(HK), P Chip(HK) and B-shares(Mainland). The percentage number refers to the Inclusion Factor applied to the free-

float-adjusted market capitalization of China A-share constituents in the pro forma MSCI China Index. China A-share securities are subject to a foreign ownership limit of 30%.

Overseas listed companies included between Nov 2015 to May 2016 as announced early 2015.

Current Status Partial Inclusion (5%) (1.3% index weight to MSCI EM )

Full Inclusion (100%)

China* 21.0%

China Overseas

5.0%

KR 14.8%

TW 12.3%

IN 8.4%

SA 7.2%

BR 6.5%

MX 4.1%

RU 3.8%

Others 16.8%

China* 17.8%

China Overseas

4.2%

China A-shares

18.1%

KR 12.0%

TW 10.0%

IN 6.8%

SA 5.8%

BR 5.3%

MX 3.3%

RU 3.1%

Others 13.6%

China:

26.0%

China:

27.6%

China:

40.0%

Shenzhen Connect enhances overall A-Share market access for potential MSCI inclusion

Capital Flow into A-shares market:

With USD1.5trillion indexed to the MSCI EM, A-share inclusion means

~USD270billion in institutional investment demand in A-shares from international

asset managers with Shenzhen as a potential key allocation market

25

HKEX A-Share Product Suite

* CNH – Offshore RMB in Hong Kong

Shanghai

Connect (~576 stocks)

Shenzhen

Connect (~904 stocks)

Single stock Index

ETFs

FTSE A50:

CSOP (code:2822)

iShares (code: 2823)

Bosera (code: 2832)

CSI300:

W.I.S.E. (code:2827)

iShares (code:2846)

Haitong (code:2811/82811)

C-Shares (code:3008/83008)

db X-trackers (code:3049)

Horizon (code: 3127/83127)

ChinaAMC (code: 3188/83188)

Futures CES China 120 Index Futures

Index

ETF Futures & Options CSOP FTSE China A50

iShares FTSE China A50

ChinaAMC CSI300

Futures USD / CNH

EUR / CNH

JPY / CNH

AUD / CNH

CNH / USD

Currency

DERIVATIVES CASH

Products are available at HKEX to manage risk against underlying A-Share and CNH* exposure

26

392 276 514

829 820 954 701

514 282 378 440 314 217 193 234 211 151 190 226 194 158 193 268 202 171 211

246 230

434

603 741 792

523

463

299

508 624

479 324 296 349 360

281 384 380

292 255 290 353

245 205 238

638 506

948

1,432 1,560

1,746

1,224

977

581

886 1,063

793

541 489 583 572

432 574 610

486 413 483 620

447 376 449

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

0

500

1,000

1,500

2,000

2,500

3,000

3,500

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

2015 2016 2017

97 69

90

200

155 143 126 94 82 80 75 62

82 66 64 65 60 62 62 66 74 61 67 64 57 82

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

0

50

100

150

200

250

300

350

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

2015 2016 2017

Market Activity in Mainland and Hong Kong Markets

Source: HKEX, SSE, SZSE & Bloomberg, as of 28 Feb 2017

Index ADT RMB bn

January – June 2015

China A Share rally

Hong Kong index and volumes

catch-up

Unprecedented volumes in 2Q

2015

July 2015 – July 2016

Downturn in A Share market

Prompted significant policy

actions by Mainland authorities

Q4 2015 saw renewal of A Share

rally, with lower volumes reflecting

less leverage

1H 2016 more subdued cash

market activity both locally and

globally

Since August 2016

Shenzhen Connect announced on

16 August and launched on 5

December

Recent pick-up in volumes

ADT HKD bn Index

SSE ADT (LHS)

SZSE ADT (LHS)

CSI 300 (RHS)

HKEX ADT (LHS)

Hang Seng Index (RHS)

2015 : +2% 2016: -5%

2015: -8% 2016: +3%

2017 YTD: +3%

2017 YTD: +7%

27

4.7 6.0

5.0 4.5 6.3

8.6 8.4

11.4 8.9

5.7 4.5 4.7 4.8

3.0 3.2 2.8 4.2

2.9 2.1 2.8 2.9 3.2 3.2 3.1 3.8 4.3 3.3 3.7

1.5 1.4

1.9

0.8

1.0 1.5

0.8 1.6

12.4

5.4

4.4

4.2

2.4

1.7 1.7 1.8

2.1 2.6 2.0

2.4 2.1

2.5 4.0 2.9

4.1

8.0

3.8 4.6

5.0 4.1

6.9

0.5

0.5

1.0

Stock Connect – Trading Trends

Source: HKEX data as of 28 Feb 2017

(1) CSRC and SFC jointly announced the approval of Shenzhen-Hong Kong Stock Connect on 16 August 2016

(2) China Insurance Regulatory Commission (CIRC) published the notice on 8 September 2016

NB record

of RMB23.4 bn

on 6 July 2015

SB record

of HKD26.1 bn

on 9 April 2015

Northbound turnover exceeded Southbound at the initial stage

Southbound turnover picked up after the announcement of Shenzhen-Hong Kong Stock Connect(1) and the approval of onshore

insurance funds to trade through Shanghai-Hong Kong Stock Connect(2)

Stock Connect Average Daily Trading Volume

Aggregate quota removed since 16 August 2016; Shenzhen Connect launched on 5 December 2016

Shenzhen Southbound (HKD bn)

Shanghai Northbound (RMB bn)

Shenzhen Northbound (RMB bn)

Shanghai Southbound (HKD bn)

28

Northbound Stock Connect – Top 10 Traded Stocks

Source: HKEX, from 1 Feb to 28 Feb 2017 (* A&H listed stocks)

Rank Stock Name ADT

RMB Million %

1 Ping An Insurance* 214.7 5.8%

2 Kweichow Moutai 165.1 4.5%

3 Founder Securities 144.3 3.9%

4 Sany Heavy Industry 121.5 3.3%

5 Anhui Conch Cement* 97.3 2.6%

6 China Merchants Bank* 80.3 2.2%

7 SAIC Motor 76.4 2.1%

8 China State Construction

Engineering 73.0 2.0%

9 Agricultural Bank of China* 67.6 1.8%

10 Industrial Bank 66.9 1.8%

Rank Stock Name ADT

RMB Million %

1 Hangzhou Hikvision Digital

Technology 159.6 8.6%

2 Midea Group 129.3 6.9%

3 Wuliangye Yibin 99.2 5.3%

4 Gree Electric Appliances 77.5 4.2%

5 Jiangsu Yanghe Brewery Joint-

Stock 68.1 3.7%

6 Yunnan Baiyao Group 35.3 1.9%

7 Geortek Inc 25.8 1.4%

8 Weichai Power* 24.1 1.3%

9 Hangzhou Robam Applicances 22.2 1.2%

10 Guangxi Liugong Machinry 20.8 1.1%

Shanghai – Hong Kong Stock Connect Shenzhen – Hong Kong Stock Connect

29

Southbound Stock Connect – Top 10 Traded Stocks

Source: HKEX, from 1 Feb to 28 Feb 2017 (* A&H listed stocks)

Rank Stock Name ADT

HKD Million %

1 China Life Insurance* 378.4 5.5%

2 HSBC Holdings 276.0 4.0%

3 Tencent 214.0 3.1%

4 China Construction Bank* 165.4 2.4%

5 China Pacific Insurance* 162.6 2.4%

6 CITIC Bank* 162.6 2.4%

7 Greatwall Motor* 153.1 2.2%

8 Digital China Holdings 150.2 2.2%

9 GAC Group* 141.3 2.0%

10 ICBC* 137.3 2.0%

Rank Stock Name ADT

HKD Million %

1 Fullshare Holdings 24.1 2.5%

2 Xinjiang Goldwind Science &

Technology* 22.8 2.4%

3 Geely Automobile Holdings 22.7 2.4%

4 Greatwall Motor* 18.6 1.9%

5 BAIC Motor 18.2 1.9%

6 ZTE* 17.9 1.9%

7 GAC Group* 17.6 1.8%

8 CITIC Bank* 17.4 1.8%

9 Tencent 17.1 1.8%

10 BYD Company* 17.1 1.8%

Shanghai – Hong Kong Stock Connect Shenzhen – Hong Kong Stock Connect

30

Agenda

Agenda

2

1 HKEX Group Financial and Market Update

HKEX Strategic Plan 2016-18

China Connectivity Update

Appendix

3

4

31

Financial Highlights – Income Statement

($ million, unless stated otherwise) 2016

% of Revenue &

Other Income 2015

% of Revenue &

Other Income Y-o-Y Change

Results

Revenue and other income 11,116 100% 13,375 100% (17%)

Operating expenses (3,455) (31%) (3,290) (25%) 5%

EBITDA 7,661 69% 10,085 75% (24%)

Depreciation and amortisation (771) (7%) (684) (5%) 13%

Operating profit 6,890 62% 9,401 70% (27%)

Finance costs and share of loss in a joint venture (91) (1%) (123) (1%) (26%)

Profit before taxation 6,799 61% 9,278 69% (27%)

Taxation (1,058) (9%) (1,347) (10%) (21%)

Loss attributable to non-controlling interests 28 0% 25 0% 12%

Profit attributable to HKEX shareholders 5,769 52% 7,956 59% (27%)

Basic earnings per share $4.76 $6.70 (29%)

Diluted earnings per share $4.75 $6.67 (29%)

Average daily turnover on the Stock Exchange $66.9 bn $105.6 bn (37%)

Capex $646 m $682 m (5%)

32

Performance by Operating Segment – 2016 Full Year

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

$ million Cash

Equity

Equity &

Financial

Derivatives

Commodities Clearing Platform and

Infrastructure

Corporate

Items

Group

2016

Group

2015

Revenue and other income 2,683 2,034 1,560 4,138 540 161 11,116 13,375

% of Group Total 24% 18% 14% 37% 5% 2% 100% 100%

Operating expenses (544) (441) (597) (702) (152) (1,019) (3,455) (3,290)

EBITDA 2,139 1,593 963 3,436 388 (858) 7,661 10,085

% of Group Total(1) 28% 21% 12% 45% 5% (11%) 100% 100%

EBITDA margin 80% 78% 62% 83% 72% N/A 69% 75%

Depreciation and amortisation (88) (86) (298) (179) (44) (76) (771) (684)

Finance costs - - - - - (82) (82) (114)

Share of loss of a joint venture - (9) - - - - (9) (9)

Profit before taxation 2,051 1,498 665 3,257 344 (1,016) 6,799 9,278

33

Annual payroll

adjustments

Headcount for

strategic initiatives

offset by

variable pay

2,020

517

294

99

360

684

2,035

500

333

106

481

771

+ 1% - 3% + 13% + 7% + 34% + 13%

Operating Expenses and Depreciation & Amortisation

Staff Costs and

Related Expenses

($ million)

IT costs of LME from

depreciation of GBP and

cost control

New office premises

for LME and rental

expenses in HK

after sale of

Worldwide House

2015 includes a $5m

recovery of legal fees

for litigation

After adjustment, net

increase by 2%

from newly completed

projects

2015 2016 2015 2016 2015 2016 2015 2016 2015 2016 2015 2016

IT & Computer

Maintenance Exp Premises Expenses

Legal &

Professional Fees

Other Operating

Expenses(1)

Depreciation and

Amortisation

One-off recovery from Lehman’s liquidators of $77m recorded in 2015

Bank credit facilities

fees

Index license fees due to futures ADV in 2016

External fund

manager fees due to funds under management

+ 10%

(excl. Lehman recovery)

(1) Includes product marketing and promotion expenses

34

34

662

44 30 0

(58)

614

88 27

6 (39)

Net Investment Income by Sources

Investment income for 2016 increased

by 3% year-on year mainly due to an

increase in gains on Corporate Funds

in 2016, partly offset by a decrease in

Margin Fund income

Corporate Funds

Investment income increased due to

higher fund size, increased gains

from both fixed income and equity

investments and lower FX losses,

party offset by a non-recurring gain

from the sale of LCH in 2015

Margin Funds

Lower average fund size in 2016

resulted in decline in investment

income but partly offset by better

yield

74

583

21

149

527

20

Net Investment Income

2016: Total $696m; 2015: Total $678m(1)

Net Investment Income by Funds

($ million)

($ million)

2015 2016 2015 2016 2015 2016

Clearing House

Funds

Corporate Funds(1) Margin Funds

Debt

Securities

Collective

Investment

Schemes

Cash & Bank

Deposits Equities(1) FX

2015 2016 2015 2016 2015 2016 2015 2016 2015 2016

(1) Includes $31 million gain on sale of LCH recorded in 2015

35

- 22% - 7% - 10% - 17%

2,252

1,421

703

770

420

422

60

70

3,435

2,683

Drivers of Revenue

Relationship of headline ADT to overall trading and clearing income is not linear

Cash Equity

($ million)

Trading fees and trading tariff 37% due to ADT

Listing fees 10% due to in number of listed companies and forfeited fees for withdrawn and lapsed applications

Trading fees and trading tariff 4% due to ADT of CBBCs and DWs and ADV of stock options contracts, offset by ADV of derivatives contracts traded on HKFE and higher proportion of higher fee products

Listing fees 22% due to in number of newly listed DWs and CBBCs

Trading fees 12% due to ADV, incentive rebates introduced since Sept 2015, and fee reduction for short-dated carries from Sept 2016

HK Clearing fees 28% due to ADT and SI

LMEC clearing fees 11% due to

ADV

Net investment income 9% due to reduced fund size

One-off Lehman payment of $38m in 2015

$79.9bn

ADT

- 37% $50.2bn

1,557 1,499

411 322

206 204

5 9

2,179 2,034

1,404 1,230

177 190

154 140

1,735 1,560

256 278

3,118

2,358

867

857

157

98

604

547

5,002

4,138

2015 2016 2015 2016 2015 2016 2015 2016

Stock Exchange listing fees Clearing and settlement fees Depository, custody and nominee

services fees Market data fees Other revenue and sundry income Net investment income

Trading fees and trading tariff

Equity & Financial Derivatives Commodities Clearing

$25.7bn

ADT

- 35% $16.7bn $105.6bn

ADT

- 37% $66.9bn

$254.7bn

SI

- 29% $181.9bn

670k

ADV

- 8% 619k

394k

Futures & Options ADV

+ 18% 464k

374k

Stock Options ADV

- 20% 298k

36

Cash 77%

2012

HKFE

Futures and

Options, and

Stock

Options

22%

Commodities

1%

Acquisition of LME in

Dec 2012 Strong growth of ADV

of derivatives market

Trading and Clearing Revenue by Product(1)

Fee diversification strategies successfully executed following acquisition of LME and

strong growth of ADV of derivatives market

(1) Data shown in this slide has been regrouped into three categories based on the 2012, 2014 and 2016 consolidated financial statements

(2) Includes all products traded on the Stock Exchange (ie, equity products, DWs, CBBCs and warrants)

Cash 54%

2016

Commodities

27%

Cash 66%

2014

HKFE Futures

and Options,

and Stock

Options

15%

Commodities

19%

(2) (2) (2)

$53.9bn $69.5bn $66.9bn ADT

HK$3,854m HK$5,758m HK$6,786m

LME Clear commenced

operation in Sep 2014 LME fee

commercialisation

in Jan 2015

Increasing proportion of derivatives income

HKFE Futures

and Options,

and Stock

Options

19%