Hong Kong Exchanges and Clearing, the world's second-largest bourse by market capitalisation, yesterday warned that competition from rivals would intensify as China liberalised its strict capital controls.

The warning came as HKEx announced its 2009 financial results and said it would forge closer links with mainland China as a key part of its new three-year strategic plan.

“The increasing internationalisation of the renminbi will significantly expand the mainland opportunities for HKEx as well as intensify the competitive pressures facing HKEx,” said Ronald Arculli, chairman. The exchange faces competition from global rivals as well as the two fast-growing mainland exchanges in Shanghai and Shenzhen.

In terms of new listings, the Shanghai and Shenzhen exchanges secured a combined $30bn through initial public offerings last year – similar to the amount raised in Hong Kong.

The rise of the two mainland exchanges makes it more important for HKEx to improve its infrastructure and develop new products, HKEx said.

Charles Li, its new chief executive, who started in January, is the first mainlander to run the Hong Kong exchange. One of his core goals is for HKEx to win approval from Beijing to start offering renminbi-denominated products.

As part of its strategy, the company said it had created three new business units, including one for “mainland development”.

“Our organisation must remain nimble,” Mr Li said.

In January, HKEx signed an agreement with the Shanghai Stock Exchange to share information and collaborate over the listing of companies and the development of new products.