The Hong Kong Monetary Authority (HKMA) is set to push through new rules allowing banks to net their equity derivatives positions when calculating large exposure limits, in a move likely to boost the city-state’s allure as a derivatives-booking hub.

Under current regulation, in place since 1997, a bank’s exposure to a single counterparty – or counterparties contained in a single corporate group – cannot exceed 25% of the bank’s capital base at all times. While this is in line with global rules