Frequently Asked Question
If you do not wish to take up your rights share entitlement, it is not necessary to submit any instruction to the Bank. If you plan to sell your rights shares, you may submit a 'sell' instruction via any of our dealing channels on or before the last dealing day of nil-paid rights shares. If you take no action, all the unsold or unsubscribed nil-paid rights shares will lapse according to rights issue timetable of the company.
Any excess share subscription application is subject to the share offer arrangement put in place by the relevant company. You may visit the HKExH K E x's website and examine the related documents available in the "Listed Company Information" section. If the rights issue or open offer proposal allows qualified shareholders to apply for excess shares on top of their entitlement, the related field in the instruction form will be opened for data input.
Please note that excess application is only eligible for customers who are defined as qualified shareholders on the record date of the relevant rights Issue/open offer proposal. If you are not recorded as a qualified shareholder and your rights shares are purchased from the market, you cannot apply for excess shares.
The following example details the excess shares application process.
Company A issues a rights issue proposal and the subscription price is HKD3.00. If you are allotted 1,000 rights shares and decide to apply for 500 excess shares, you have to enter 1,000 rights shares and 500 excess shares in the appropriate fields in the reply form. When submitting your instruction, you must ensure that you have sufficient available funds (HKD4,500.00 in this example) to apply for 1,500 shares (1,500 shares xtimes HKD3.00 subscription price) in your designated payment account. The Bank will debit the whole subscription amount (for rights shares and excess shares) on the debit date to complete the subscription process.
Excess applications are not guaranteed to be wholly accepted. The payment related to any unsuccessful excess share application will be refunded. Using the above example, if only 99 shares are allotted under the excess share application, you will receive 1,099 Company A shares (1,000 fully-paid rights shares and 99 successfully allotted excess shares) on the expected fully-paid rights shares issuance date and will receive a refund of HKD1,203.00 (401 excess shares applied for but not allocated xtimes HKD3.00 subscription price).
Please note that we will act on behalf of various individual customers to make excess shares applications. However, the company making the rights share issue will treat Hang Seng as a single shareholder in its nominee capacity and only allow the Bank to lodge ONE excess application form. Thus, if the issue is over-subscribed and allotments are scaled back, our distribution of excess shares to applicants may not necessarily be the same as those published by the company. We will distribute the total quantity allotted to Hang Seng on a pro rata basis to all underlying customers.
Furthermore, there are respective charges for different corporate events. Please refer to 'Service Charges' under the 'Personal Banking' section of Hang Seng's website.
In this situation, please visit our designated branches or via e-Banking (1 calendar day after the purchased rights shares settled) to submit your instruction after you have successfully purchased your right shares before the Bank's reply deadline.
If the reply date happens to be a Severe Weather Trading day, our designated branches will be closed but you can still submit your instruction online.
If your instruction has been received, our system has to hold your rights shares or open offer shares while the subscription process is completed. Instructions pending completion cannot be displayed on the corporate event page in e-Banking.
We will act on behalf of you to take up your final total holding after the reply deadline of that related instruction.
We will debit your designated payment account on the debit date stated on the related corporate event advice.
Please note that your account may be debited at any time on the debit date. If there are insufficient funds for the entire aggregated subscription amount of all your instructions in your designated payment account during our debit process, the Bank has the discretion to stop processing your applications without prior notice.
It is therefore highly recommended that you ensure there are sufficient funds in your account by 23:59 on the night before the debit date in order to successfully complete the subscription process.
The Bank can only debit settled funds for processing your subscription on the debit date and receivable funds cannot be used as available funds for a subscription.
As all exchange trades are required to be settled on trade day (T) +plus 2 days, there is a possibility that the receivable funds of your sale order may not have been settled yet if the subscription debit day is on the same day as T +plus 2. Your account may be defined as maintaining insufficient available funds and the Bank will stop processing your application.
It is therefore highly recommended that you ensure there are sufficient funds in your account by 23:59 on the night before the debit date in order to successfully complete the subscription process.
Please refer to the expected timetable on the relevant corporate event advice. Please note that the Bank will deposit the shares or credit the refund amount into your account after such shares/refund amount have received from related clearing institution or registrar.