KPMG: Wealth, IPOs to Fuel Hong Kong Banking Growth

The growth of Hong Kong’s banking sector is expected to be driven by strong wealth management and public listing pipelines in 2026, according to KPMG. In 2026, Hong Kong’s banking sector is expected to grow due to strong wealth management and IPO pipelines, according to KPMG’s 11th annual «Hong Kong Banking Outlook». In wealth management, more strategic collaboration is expected with asset managers seeking regional growth, resulting in a broader range of products and approaches. And after retaking the IPO throne in 2025, momentum could be maintained in a revitalized market. «As we enter 2026, KPMG is more optimistic about Hong Kong’s banking sector. The strong performance of Hong Kong’s equity market in 2025 has significantly lifted sentiment,» said Paul McSheaffrey, senior banking partner, Hong Kong SAR, KPMG China. «Recent policy initiatives, including efforts to strengthen the city’s fixed-income market and to support Chinese Mainland enterprises in ‘going global’ through Hong Kong, provide further confidence in the future. We expect increased bank investment and hiring to follow.» Tokenization: Beyond Proof of Concept Another noteworthy trend is the emergence of tokenization beyond the proof-of-concept stage. Banks have conducted real-world transactions using tokenized deposits through the Hong Kong Monetary Authority’s (HKMA) Project Ensemble, stablecoin licence applications are underway and tokenized gold is also being issued. «Looking ahead to 2026, KPMG expects traditional banks and the digital-asset ecosystem to move closer together. Banks will likely begin offering services such as digital-asset custody and a broader range of tokenized products as the regulatory framework becomes clearer,» the report noted. Rising Cyber Threats Despite the optimism, there are also looming risks, including the rise of cyber threats. KPMG foresees that threat actors will increasingly leverage AI and automation to identify vulnerabilities with greater speed and precision, while attacks through third parties and the broader digital ecosystem continue to increase. «For banks, this means cyber resilience will become an even more pressing board level priority,» KPMG added. «The HKMA will continue expectations around technology risk management, clear accountability for cyber risk, and the ability of banks to maintain critical services and recover swiftly when incidents occur.»