Hong Kong's finance chief resigned Monday ahead of what is widely expected to be a tilt at the city leadership.

John Tsang -- nicknamed "Mr Pringles" by local media for his resemblance to the crisp brand's mascot -- is seen as a more moderate alternative to current leader Leung Chun-ying, who said Friday he would step down in July.

The city has become sharply divided under Leung, whose term has been marked by anti-Beijing protests. Opponents cast him as a puppet of the Chinese government squeezing the semi-autonomous city's freedoms.

Tsang confirmed to reporters Monday evening that he had resigned after more than nine years, but stopped short of announcing he would run for the leadership.

"I shall think through this in the coming days and make an announcement," he said.

He used the opportunity to thank the Chinese government for their "support and encouragement" as well as the people of Hong Kong.

Tsang recapped how he had witnessed the city returned to "our motherland" -- referring to the handover of Hong Kong from Britain to China in 1997.

He also said that Hong Kong's high degree of autonomy had been "successfully implemented".

The finance secretary's resignation is being seen as a signal that he will stand in the leadership elections in March. Candidates are not allowed to hold a government office if they want to stand for chief executive.

- Skewed system -

Although Tsang has a better public image than Leung, he is still an establishment figure.

Pro-democracy campaigners have warned the next city leader will simply be another Beijing yes-man as the vote system is skewed.

The chief executive is chosen by an electoral committee made up of representatives of special interest groups, weighted towards Beijing.

Mass rallies in 2014 called for fully free leadership elections, but failed to win concessions on reform.

Special interest groups voted for members of the election committee on Sunday -- of almost 1,200 only around a quarter come from the pro-democracy camp.

Speculation that Tsang would run for office intensified last year after China's President Xi Jinping shook his hand during a meeting in Beijing.

There was another handshake between the two in September at the G20 in Hangzhou.

Former security minister and current senior lawmaker Regina Ip is also expected to announce her candidacy this week.

Ip is hated by the pro-democracy camp for supporting controversial anti-subversion law Article 23 when she was minister in 2003. It was dropped after hundreds of thousands of residents protested.

However, she has a strong support group in the establishment camp -- in recent legislative elections Ip was one of the most popular candidates receiving 60,000 votes.

Current government number two Carrie Lam has also said she will consider running.

Only one candidate has declared they are running for the leadership so far -- retired judge Woo Kwok-hing who has said he wants to help Hong Kong overcome its divisions.

Analysts say Tsang would stand the best chance.

"John Tsang is accepted by many pan-democratic supporters and the business circle in the pro-establishment camp," said Edmund Cheng, professor of government and international studies at Hong Kong Baptist University.

Cheng added that Tsang had outranked all other potential candidates in opinion polls.