Failed LSE bid ruled out as root of Li shocker

Charles Li Xiaojia surprised the market when he announced he is quitting as Hong Kong Exchanges and Clearing boss next year - though the shocker is not related in any way to the failed acquisition bid of the London Stock Exchange.

That was the word from HKEX chairman Laura Cha Shih May-lung yesterday.

When Li was asked if he was seeking to run as Hong Kong chief executive, he asked back if he had a "big heart" to take that role.

Li, 59, said he will continue to lead the exchange until his contract expires in October 2021. He may leave earlier if a replacement is found, according to a filing.

Shares of HKEX dropped as much as 4 percent and closed 2.76 percent lower at HK$246.40 yesterday.

Speculation arose on Li's next move. When asked if he will help Macau build a new financial center, he described journalists as "having a good imagination."

Li playfully said he was hoping people will regard him as someone who is middle-aged and not retired, and that he could become another David Beckham and have a team of players above 50, though he is "not rich enough" to buy a football club.

He said "the past 10 years has been a most exciting and meaningful time in his life," describing the HKEX as a "dream house." But it is time to find a successor and for him to pursue new goals.

Cha praised Li's leadership and thanked him "for giving us as much time as possible to ensure a smooth transition." The exchange has formed a committee, led by Cha, to search for a successor.

Many believe that, like Li, his successor has to have good mainland connections. Cha said the recruitment will be conducted globally, and internal staff are not excluded. The successor has to have "vision, energy, resource," she said.

The Securities and Futures Commission and Financial Secretary Paul Chan Mo-po also expressed their appreciation to Li.

Li is well-remembered for enhancing the link between the mainland and Hong Kong markets with Stock Connect and Bond Connect.

He pushed through major reforms in the listing system to introduce companies with weighted voting rights, which has brought in tech giants like Xiaomi, Meituan Dianping and Alibaba, as well as biotech firms still in the research stage.

Still, the failed bid to take over the LSE last year as well as the failure in putting Alibaba into Stock Connect stand as missteps during Li's tenure.

Also, a former listing vetting team head and an IPO consultant were arrested by the Independent Commission Against Corruption for alleged misconduct last June, which was also regarded as a setback for him.

In December Li sold his shares in the bourse for the first time since he took the helm a decade ago, cashing in about HK$167 million.

stella.zhai@singtaonewscorp.com