Hong Kong appoints ex-KPMG China head Carlson Tong as chairman of the exchange
The Hong Kong government plans to appoint Carlson Tong, the former chairman of KPMG China, as chairman of the city’s stock exchange.
Tong is expected to become the next chairman of Hong Kong Exchanges & Clearing Ltd after April 24. take over, according to people familiar with the matter. The city’s leader, John Lee, will formally make the appointment as required by local securities law, the people said. The government owns about 5.9% of the stock market and appoints half of the board, including Tong who has been director since 2023.
Together with HKEX’s new CEO Bonnie Chan, the duo are expected to revive the exchange after a sharp decline in IPOs and a decline in stock trading volumes. Many foreign investors have reduced their positions in Chinese companies with Hong Kong-listed shares amid a downturn in the Chinese economy and rising geopolitical tensions. Last month, HKEX reported a 13% decline in fourth-quarter profit to HK$2.6 billion ($332 million).
Laura Cha, the incumbent chairman, will step down after this year’s annual general meeting on April 24 after completing the six-year term.
At a press conference on Friday, Chan said many issuers are currently looking for the best timing. The stock exchange has received approximately 30 new applications for a stock exchange listing and approximately 40 renewal applications this year.
Tong and a spokesperson for HKEX declined to comment. Spokespeople for the government’s Chief Executive Office and Financial Secretary Office were not immediately available for comment. Reuters reported the news earlier.
Tong has a history of leading difficult projects. Most recently, he was tasked with leading an expert group to suggest ways to increase liquidity in the stock market, which led to the city eventually cutting stamp duty on stocks.
During his six-year tenure as chairman of the Hong Kong Securities and Futures Commission, Tong helped establish a groundbreaking trading relationship known as Stock Connect, which allows investors in mainland China to access select stocks in Hong Kong and vice versa.
He was also the government observer for Cathay Pacific Airways Ltd. when the airline ran into financial problems and needed government funding.
Tong, a father of three, once headed the English Schools Foundation, the city’s international school chain, and the Hong Kong Sports Institute. He will remain an independent director at lender Standard Chartered Plc until May.
Management realignment
Tong’s appointment would be accompanied by a larger reshuffle on the stock exchange. Bonnie Chan, who took over the stock exchange’s top job on March 1, will take direct charge of more corporate functions, including the division dealing with mainland China, corporate communications and human resources. She is the first female CEO of HKEX.
Wilfred Yiu, the deputy CEO and co-chief operating officer, was stripped of the operating division he led for 16 months, according to a new organizational structure chart on the exchange’s website. The operations group includes trading, market surveillance and monitoring, as well as clearing and custody services.
Yiu, a former Goldman Sachs Group Inc. banker. who was once seen as a potential successor to former HKEX boss Nicolas Aguzin, has a new mandate to oversee information technology alone with CEO Chan, and will oversee the markets department together with Glenda So.
The operating division now reports to Vanessa Lau, Chief Financial Officer and co-Chief Operating Officer of HKEX.
Chan will also directly oversee listings, risk management and compliance, along with the commodities group that includes the London Metal Exchange and LME Clear. She previously worked as a lawyer, advising on IPOs of Chinese companies, and as a banker in the equity capital markets.
Her base salary as CEO is HK$10 million per year, the same as that of her predecessor Aguzin, before bonuses and share awards.
First print: March 8, 2024 | 12:15 pm IST