The director of the Hong Kong Stock Exchange will resign at the end of the mandate

Nicolas Aguzin will step down as chief executive of the Hong Kong Stock Exchange (HKEX) at the end of a three-year tenure that has seen the market lose ground as a major global destination for listings.

According to the Financial Times, citing the exchange operator's statement on Friday, Aguzin has informed the HKEX board that he will not seek renewal at the end of his current contract in May 2024. He will be replaced by Bonnie Chan, HKEX's co-chief operating officer , who was granted a three-year mandate.

The presence of Aguzin - an Argentinian who previously worked in Buenos Aires and New York - at the helm of HKEX was seen as a sign that the exchange wanted to strengthen its position on the global stage rather than focus on ties with mainland China.

HKEX announced on Friday that it was grateful for Aguzin's "contribution and leadership over the past two and a half years, in a particularly challenging macro context, affected by Covid and weak global markets". For his part, Aguzin said it was "the privilege of his life" to lead HKEX.

His departure comes amid a sweeping overhaul of the Hong Kong Stock Exchange. HKEX co-chief operating officer Wilfred Yiu, along with Bonnie Chan, will become deputy chief executives, while chief financial officer Vanessa Lau will be co-chief operating officer in addition to her current role.

The exchange operator's president, Laura Cha, will also reach the end of her term next year.

• The HKEX share price has fallen 42% under Aguzin's tenure

The HKEX share price has fallen 42% since Aguzin's tenure began during the Covid-19 pandemic, when both Hong Kong and mainland China suffered from isolation from the financial world as a result of strict quarantine measures.

Hong Kong's benchmark Hang Seng index has fallen 16.6% this year. The exchange's results for the third quarter of 2023 showed that revenues from trading activity fell by 10% compared to the same period in 2022, while commissions from stock listings decreased by a fifth. Net profit rose 30% on solid investment income and derivatives trading volume.

Funds raised from initial public offerings in Hong Kong fell nearly 40 percent year-on-year to about $5 billion, compared with an annual average of $37 billion over the previous decade, Dealogic data shows.

• The stock market in India surpassed that of Hong Kong, becoming the seventh in the world

The market value of the Indian Stock Exchange has surpassed that of its rival in Hong Kong, becoming the seventh largest in the world, as optimism about the country's economic prospects is growing, according to CNBC.

At the end of November, the total market capitalization of India's National Stock Exchange was $3.989 billion, compared to $3.984 billion for the Hong Kong Stock Exchange, according to data from the World Federation of Stock Exchanges.

India's Nifty 50 index hit a new record high last week. In 2023, the Nifty 50 has climbed 16% and, if the upward trend continues, will end its eighth consecutive year of gains. In contrast, the benchmark Hang Seng index of the Hong Kong Stock Exchange has fallen by around 17% this year. The Hang Seng is on track for a fourth straight year of declines and also recorded the worst performance among the main Asia-Pacific stock markets, according to CNBC.

This month, rating agency Moody's cut its outlook for Hong Kong from "stable" to "negative", citing the city's financial, political, institutional and economic ties to mainland China. This downgrade came shortly after Moody's cut its outlook for China's government credit ratings to "negative" from "stable."

A recent analysis by Bloomberg showed that the historic drop of $4.6 trillion in the capitalization of the Hong Kong Stock Exchange is being felt in the city's financial industry, with 30 local brokerages closing this year.