On August 24, recent news reported that some banks in Hong Kong have initiated a source of funds declaration procedure for certain existing mainland investment clients, setting deadlines of August 20 (suspension of investment services if not submitted) and September 12 (termination of investment services if not submitted).

Previously, in response to requirements from the Hong Kong Securities and Futures Commission and the Hong Kong Monetary Authority, some banks had begun to require new mainland account investors to confirm that their source of funds is from legal overseas channels. This source of funds confirmation procedure targets existing mainland investor accounts, primarily focusing on long-term “inactive accounts.” It is understood that some licensed institutions in Hong Kong, including HSBC Hong Kong and branches of Chinese banks in Hong Kong, have indeed implemented such measures recently.