The Pakistan Stock Exchange (PSX) stands as a crucial pillar in the country’s financial infrastructure, playing a vital role in channeling capital, facilitating investment, and contributing to economic growth. Established on September 18, 1947, the exchange has undergone significant transformations over the years, culminating in its formal incorporation on March 10, 1949, under the name ‘Karachi Stock Exchange’ (KSE).
As economic activities expanded in Pakistan, the need for regional stock exchanges became apparent. In response to this, a second stock exchange was inaugurated in Lahore in October 1970. This move aimed to meet the growing stock trading demands of the provincial metropolis, further diversifying the nation’s financial landscape.
In October 1989, another significant development took place with the establishment of the Islamabad Stock Exchange (ISE). This move was strategic, aiming to cater to investors in the northern parts of the country. Each of these exchanges operated independently, with separate management structures, trading interfaces, and indices.
The independent functioning of the three exchanges posed challenges such as fragmented operations, lack of standardized practices, and varying degrees of efficiency. Recognizing the need for a unified and more efficient stock exchange system, the Government of Pakistan promulgated the Stock Exchanges (Corporatization, Demutualization, and Integration) Act, 2012.
The groundbreaking legislation aimed to address the challenges by promoting corporatization and demutualization of the stock exchanges. Corporatization involved transforming the exchanges into corporate entities, subject to regulatory oversight. Simultaneously, demutualization aimed to separate ownership and trading rights, ensuring transparency and accountability.
On January 11, 2016, a historic moment unfolded as the three stock exchanges-Karachi, Lahore, and Islamabad-integrated their operations under the new name ‘Pakistan Stock Exchange Limited’ (PSX). This marked a paradigm shift in the country’s financial landscape, fostering a more cohesive and streamlined stock exchange system.
Key Impacts of Integration:
1. Unified Governance: The integration eliminated redundant management structures, streamlining governance and decision-making processes under a single entity, PSX.
2. Standardized Practices: With the integration, the stock exchanges adopted uniform trading interfaces, indices, and operational procedures, promoting consistency and efficiency.
3. Enhanced Market Attractiveness: A consolidated stock exchange increased market attractiveness for both domestic and international investors, fostering a more competitive and vibrant financial ecosystem.
4. Improved Regulatory Oversight: The integrated structure allowed for more effective regulatory oversight, ensuring compliance with industry standards and enhancing investor protection.
The evolution and integration of the Pakistan Stock Exchange reflect a commitment to modernizing and strengthening the country’s financial infrastructure. The establishment of PSX as a unified entity marked a significant milestone, addressing historical challenges and paving the way for a more robust and investor-friendly stock exchange. As Pakistan continues its economic journey, the PSX stands poised to play a pivotal role in shaping the nation’s financial future.
FARRUKH A. KHAN
MANAGING DIRECTOR /CEO PSX
In the dynamic world of finance, where acumen and strategic insight are paramount, Farrukh Khan stands as a beacon of leadership and expertise. As the Chief Executive Officer of the Pakistan Stock Exchange Limited (PSX), Farrukh brings a wealth of experience, knowledge, and a stellar track record that has left an indelible mark on the financial landscape.
Farrukh Khan’s journey to the top echelons of the financial world is marked by an impressive academic background. A qualified Chartered Accountant from the esteemed Institute of Chartered Accountants in England and Wales, United Kingdom, he complements this with a BA (Hons.) in Economics and Finance from the University of Manchester. This robust academic foundation forms the bedrock of his illustrious career, which spans over three decades.
With over 30 years of senior management and board-level experience, Farrukh is not merely a CEO; he is a seasoned entrepreneur and a trusted financial advisor. His tenure with Acumen, a pioneer in impact investing, showcased his prowess as he navigated roles such as Country Director & CEO, Pakistan, Senior Director Business Development, Chief Business Development Officer, and member of the Management Committee. His impact was not limited to the national borders, as he seamlessly integrated his expertise between Pakistan and the UK.
Before his role at PSX, Farrukh Khan served as the founding partner and CEO of BMA Capital Management Limited. Under his visionary leadership, BMA established itself as the leading investment banking group in Pakistan, earning international recognition, including the prestigious 2010 Euromoney award for the best investment bank in Pakistan. His stellar achievements include successfully managing the US$813 million GDR offering and London listing of OGDCL, Pakistan’s largest listed company, and advising on Etisalat’s monumental $2.6 billion acquisition of Pak telecom-the largest M&A transaction and foreign direct investment in Pakistan’s history.
Farrukh’s impressive track record extends to key transactions such as the US$1.5 billion privatisation of Kot Addu Power Company and the US$898 million GDR offering for Pak Telecom. His strategic counsel has played a pivotal role in almost 50% of all successful privatisations in Pakistan, amounting to over $4 billion in value. His professional journey also includes stints with American Express Bank in Pakistan and Deloitte in London, underscoring his global perspective and deep-rooted understanding of international business.
Beyond his corporate achievements, Farrukh Khan is a recognized leader in various capacities. He served as the President of the Overseas Investors Chamber of Commerce & Industry (OICCI) and chaired the Young Presidents’ Organization, Pakistan Chapter. His association with the Securities and Exchange Commission of Pakistan as a member of its Policy Board from 2018 to 2019 is a testament to his commitment to regulatory governance.
Acknowledging his exceptional leadership, Euromoney selected Farrukh as one of the top 50 global financial leaders under the age of 40. This recognition underscores his ability to innovate and drive change in the financial sector.
While Farrukh Khan’s professional accomplishments are formidable, his philanthropic endeavors reflect a commitment to societal well-being. His focus on children’s health and education demonstrates a holistic approach to corporate responsibility, aligning his professional success with a broader vision for positive societal impact.
Farrukh Khan’s journey from a qualified Chartered Accountant to the CEO of PSX is a testament to his unwavering commitment, strategic vision, and ability to navigate complex financial landscapes. His leadership at PSX is poised to be transformative, charting a course for sustained growth and innovation in Pakistan’s financial markets. Farrukh Khan is not just a CEO; he is a financial luminary, a trailblazer, and a catalyst for positive change in the world of finance.