VALU

[SINGAPORE] Loh Boon Chye – the man who steered the Singapore Exchange (SGX) through a period of trading disruptions and into the highly profitable world of multi-asset derivatives – is preparing to step down after more than 11 years at the helm.

Speaking at SGX’s 27th annual general meeting on Friday (Oct 23), Loh, 62, said that he recently informed the exchange’s chairman, Koh Boon Hwee, that they should “begin planning for an eventual transition in the CEO role”.

Loh’s contract runs until mid-July 2027, which leaves ample time for a smooth handover, the chief executive told shareholders. No date has been set.

The planned transition comes at a time of renewed momentum in the Singapore stock market and growth opportunities in SGX’s derivatives and foreign exchange businesses.

Loh said that the bourse operator is in “a stronger position today”, having developed a “more diversified business” with several growth engines.

Even as he signalled his eventual departure, Loh stressed that his ambitions for SGX remain unchanged. “I want us to accelerate our growth, expand our global reach and take SGX to a new level. That is what I intend to drive forward,” he said.

“What matters is that we get this right – in the best interests of the company, our people and our shareholders – and keeping SGX’s momentum and ambitions firmly on track.”

He said that he will work closely with Koh and the board to determine the “appropriate timing and arrangements” for a smooth handover, ensuring continuity in SGX’s strategy, business operations and stakeholder relationships.

Bittersweet moment

Chairman Koh called it a “bittersweet moment”, and reminded the room of the mess Loh inherited.

“When Boon Chye first stepped into the role more than 11 years ago, the SGX was in the middle of what I would call a crisis,” Koh said.

The Monetary Authority of Singapore (MAS) had reprimanded the exchange over two market outages in November and December 2014. That came just weeks before Loh started work on Jul 14, 2015.

Loh spent the next two to three years fixing the bourse’s ailing IT systems. He then drove a hard pivot away from a sleepy cash equities market and towards a global, multi-asset platform.

He was appointed SGX CEO in July 2015 after a 3.5 month search. A former investment banker, he spent 17 years at Deutsche Bank and three at Bank of America Merrill Lynch. He also sat on SGX’s board from 2003 to 2012. He now chairs the World Federation of Exchanges.

“The company has done really, really well under Boon Chye’s leadership,” Koh said.

He noted that SGX’s share price rose 216 per cent from Loh’s arrival to Jun 30 this year. Net profit jumped 112 per cent, while market value surged 252 per cent. “That is a significant track record.”

The past year was the best yet. For the financial year ended June 2026, net revenue rose 13.9 per cent to S$1.48 billion. Adjusted net profit climbed 24.6 per cent to S$759.5 million.

Cash equities net revenue rose 28 per cent, as securities daily average value jumped 35 per cent to an 18-year high. SGX FX, the over-the-counter currency business, grew net revenue 12 per cent to another record. Derivatives volumes hit records in contracts from yuan and rupee futures to iron ore and freight.

Shareholders on Friday approved a one-off dividend of S$0.125 per share from capital recycling gains, on top of a final dividend of S$0.115 a share. That takes the total payout for FY2026 to S$0.57 a share, up 52 per cent. For FY2027, SGX expects expenses to rise 6 to 8 per cent, with capex of about S$100 million.

“Being at the top of a company like the SGX comes with a tremendous amount of pressure, and I think all of you shareholders will agree that we should applaud our CEO while he plans to transition,” Koh said.

Reviving the cash equities market

In an interview with The Business Times in August, Loh said SGX “needs to be better understood”. The way he sees it, the public judges the bourse by its domestic stock market while the real engine room sits offshore and spans asset classes.

Yet the cash equities market remains the stubborn child. Retail shareholders at the meeting were quick to point out a structural flaw. One argued that liquidity is heavily concentrated in the three local banks.

He noted that bank shares fell on the very day smaller board lots kicked in. Since Oct 5, 11 stocks priced above S$10 can be traded in lots of 10 shares instead of 100. Without targets, he warned, money from the S$6.5 billion Equity Market Development Programme would keep flowing back into the same large counters. That leaves small and mid-cap stocks gasping for air.

Koh pointed to the iEdge Singapore Next 50 Indices, launched in September 2025 to track the 50 largest mainboard companies outside the Straits Times Index.

The shareholder said this was a good step but not targeted enough. He suggested the market needs exchange-traded funds aimed squarely at mid and small caps.

Loh offered early signs that smaller lots are working. In the first two weeks of October, turnover in the 11 counters ran about 3.6 per cent higher than for STI stocks, he said. A bigger share of it came from individual investors.

The real structural push, however, is coming from SGX RegCo. The same shareholder praised the frontline regulator’s value-creation drive, in particular a new rule on dividend policies. From Jan 1, 2027, every listed company must keep a dividend policy. Its annual report must also explain any departure from it.

A recent media commentary had accused RegCo of “overcooking the broth”. The shareholder called that unfair, and asked the room to applaud the regulator instead.

Koh was unbothered. “They are not so thin-skinned,” he said.

The rule does not force anyone to pay out. Companies need not commit to a payout, and can say they would rather keep cash for growth. But it does make hoarders say so in writing. For retail investors, that is a start.

The SGX board, meanwhile, showed it can read the room. Koh opened the meeting by withdrawing a resolution on a new share plan, after feedback on “certain parameters”. The board will review the feedback and may return with a revised plan. SGX’s existing share schemes stay in place.

As Loh begins his long goodbye, the brief for his successor is already taking shape. SGX has built a global derivatives franchise. The next chief must make South-east Asian companies actually want to list here.

SGX shares were down 0.5 per cent or S$0.11 at S$20.73 as at 12.40 pm, after the announcement. Additional reporting by Isabelle Chong