New Zealand’s financial services industry regulator has announced today that its CEO, Sean Hughes, tendered his resignation from his leadership position.
The New Zealand Financial Markets Authority (FMA) elects senior executives, each of which serve two-year terms, at the expiry of which a re-election must take place.
Mr. Hughes was appointed CEO of the FMA designate in October 2010, in preparation for the regulator commencing operations on May 1, 2011. Having joined the FMA from a senior regulatory role at Australian regulator ASIC, Mr. Hughes previously held roles in banking, financial services, law firms and with public sector organizations in New Zealand, Hong Kong, Australia and Britain.
Under Mr. Hughes’ leadership, the FMA took on its regulation of the OTC Derivatives marketplace, regulating forex companies in the jurisdiction and tightened up rules.
Until recently, many firms established in New Zealand due to its laid-back approach to financial markets regulation, proximity to the Asia-Pacific region and ease of doing business with a secure financial system and native English-speaking population. Last year, the FMA and Financial Services Providers Register issued a notice to all market participants stating that it would terminate the license of those organizations without physical offices and actual operations in New Zealand. Subsequently, 250 firms were unregistered by the authorities early this year.
Alpari Turns Its Back On NZ
There has also been a small-scale exodus of international FX companies from New Zealand, as denoted by Alpari’s exit from the Pacific Island in May this year.
Alpari cited pending government regulatory changes as a primary reason for packing its bags. On June 3, all accounts were transferred to Alpari Ltd in St. Vincent.
The firm cited that the proposed rulings would affect trading conditions of Alpari RU account holders, stating at the time that “this transition is due to planned changes in New Zealand legislation that would force us to adopt more restrictive trading terms and eliminate certain services which our customers currently enjoy.”
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External Search For New CEO
In this case, Mr. Hughes will continue his role until the end of the year, and will not seek re-appointment for a second term as Chief Executive.
FMA Chairman Simon Allen said Mr. Hughes had done an outstanding job in leading the FMA to build credibility and confidence in the new regulator and financial markets since its establishment three years ago.
“While the Board is naturally disappointed that Sean will not be continuing beyond the end of his three year contract, we respect his decision” stated Mr. Allen on behalf of the regulator.
“We also recognize the significant work he has put into FMA’s establishment and its positioning in both the domestic and Asia-Pacific markets,” he continued.
On looking ahead, Mr. Allen explained that the FMA is set to expand its operations next year, due to further regulatory rulings coming into effect in New Zealand: “Looking forward, FMA’s regulatory scope is set to further expand from next year with the introduction of the Financial Markets Conduct Act. The timing is well aligned for the next Chief Executive to advance this work” he concluded.
Reflecting on his achievements during his tenure at the FMA, Mr. Hughes said the launch and build of FMA had been an intense and satisfying period of work.
“Having delivered on my primary task to design, build and implement the strategic and operational platform for FMA, I have decided to complete my contract this year, and look to identify my next challenge,” said Mr. Hughes.
“Announcing my decision now will allow a smooth and orderly transition for the leadership of FMA’s next stage.”
The FMA Board will seek an external agency to assist with the search for a new CEO and an appointment is expected to be made by the end of the year.