MANILA, Philippines - The president and chief executive of the Philippine Stock Exchange (PSE) made it clear on Thursday that he decided to quit his post due to health reasons.
Lim will step down on February 16, about two months before his term expires, the PSE said in a disclosure on Thursday.
|abs-cbnNEWS.com has been following corporate governance issues at the PSE and the spate of departures of its key officials. Read our special report here.
His planned departure sparked fresh concerns about governance issues that have hounded the local bourse over the past year.
Sources said the outgoing official had been wanting to leave because of constant disagreements between the PSE board and management. There were also rumors that he was facing the possibility of being axed for failing to keep his lieutenants in tow with the leanings of majority of the board members on certain regulatory issues.
However, Lim clarified that he was leaving because his doctors advised him to "take it easy" after he underwent angioplasty in 2006.
"I have to be very truthful, life in the PSE is not easy. It's very stressful to carry the responsibility of the whole market on a day-to-day basis," he told reporters during a teleconference.
To a query regarding the rumored conflict between board members and officers, Lim said: "I don't want to be critical about this. There were some disagreements, but these were all resolved in a very professional manner. I'm leaving the exchange fully convinced that all the disagreements have been settled in a professional manner."
The PSE, in its disclosure, said Lim will return to private law practice and will just help the exchange bring about initiatives for the capital market.
Lim is the 6th—and the most senior—management official to leave the PSE since last year.
Former disclosure department head Pete Malabanan left early 2009, citing health problems. Not long after, Conchita Manabat, who chaired the Market Integrity Board, the body which polices trading participants and listed companies, abruptly resigned.
Roy Rafols, who was chief operating officer and head of the Issuer Regulation Division, left in September because the board decided not to renew his contract. A month after, Joseph San Pedro, then head of the Market Regulation Department, quit his post after he reportedly came into conflict with some brokers for posting their violations on the PSE website.
The board has also not renewed the contract of Jonathan Juan Moreno, the head of corporate governance unit, which is spearheading several initiatives to align PSE's governance standards with international practices. He will leave the exchange by February.
While talks about Lim's departure have been rife since last year, the news still came as a surpise to some.
"It came as a shock to us. Francis Lim was very supportive of the policy reforms that protected minority shareholders, pushed for better corporate governance, and allowed for a conducive market environment. This is a very big loss," said analyst PJ Garcia, chief investment officer at ING.
Garcia noted that Lim provided a healthy balance between the regulatory and business aspects of running the bourse.
"He needed to improve the market infrastructure, the governance, or else the market would have not been competitive. I disagree that he may have focused too much on legislative reforms. Those reforms needed to be put in place."
Francisco Liboro of brokerage firm PCCI Securities meanwhile said: "I appreciate the fact that he tried to improve equities investment. Our system here is not as liberal and a lot of legislation had to be redone. Some of the laws were antiquated, some obsolete. Lim pushed for the appropriate update of the legislations."
"I'm happy for what he's achieved for us. He has done a lot in terms of improving the quality of management in the exchange," added Harry Liu, president of Summit Securities.
All 3 traders were one in saying that the next CEO should continue and finish the reforms Lim started, while finding new ways to attract investors into the local market.
"The Philippines has the smallest bourse in the region. Over the past couple of years we have lagged behind in terms of foreign investments into the stock market. the next guy will have to address that carefully," said Garcia.
Longest serving PSE chief
Lim was the longest serving president of the PSE since the bourse was demutualized or converted from a member-owned company into a shareholder-owned firm in August 2001.
PSE chairman Hans Sicat, who will head the team that will search for Lim's replacement, thanked the outgoing official for his many years of dedicated service to the exchange.
"A lot of the work he has spearkeaded has now started to bear fruit and the various stakeholders and partners of the PSE are grateful for this. We wish Francis the best of luck in his new endeavors," Sicat said.
Lim, for his part, said: "I am truly blessed for having been given the opportunity to serve the exchange as president and CEO. The past 5 years have not been a walk in the park but the exchange definitely surged forward with some of the fresh initiatives badly needed by the market. Along the way, I have come across well-meaning people prepared to support the development of our stock market."
Lim has been credited for several market initiatives such as:
- permanent documentary stamp tax exemption for stock market transactions
- Personal Equity Retirement Account Act (PERA)
- Credit Information System Act (CISA)
- Real Estate Investment Trust Act (REIT law)
"I fervently hope that the exchange will remain genuinely and steadfastly committed to reforms for the interest of our market." Lim added.
While the exchange is looking for Lim's replacement, it has appointed Atty. Val Antonio Suarez as chief operating officer and senior vice president, and PSE general counsel Roel Refran as head of the Issuer Regulation Division. - Report from Michelle Orosa, ABS-CBN News