Investment expert banks on leading edge
CCB International is doing very well in Hong Kong and will actively look for business opportunities from emerging industries and companies on the Chinese mainland, said Hu Zhanghong, chairman and chief executive of the investment institution.
Hong Kong-headquartered CCB International is wholly owned by China Construction Bank Corp, and its services include sponsoring and underwriting, financial advisory services, corporate mergers and acquisitions (M&As), as well as restructuring, asset management, direct investment securities brokerage and investment consultancy, Hu told China Daily.
“Our core business has been performing very well in Hong Kong. ( Take) our initial-public-offering (IPO) service, for instance. According to (financial analysts) Dealogic, CCB International in 2015 was the book runner for 18 IPOs and that makes us No 1 among the world’s top investment institutions in Hong Kong.”
CCB International’s corporate mergers and acquisitions drive is also doing well, thanks to the “going overseas” strategy of Chinese enterprises, Hu pointed out.
CCB International has a competitive edge over its Chinese and foreign peers alike, as it is more familiar with the local market, Hu noted.
During the past decade, most of the companies that came to Hong Kong looking for services from investment banks have been from the Chinese mainland. CCB International understands Chinese mainland companies, and its ability to provide comprehensive financial services is envied by foreign investment banks, Hu claimed.
CCB International is among the few mainland investment managers that can boast international networks, which is quite an advantage, Hu said.
Hu said that the mainland economy is obviously undergoing restructuring, on a scale that has never been seen by the world before. During the structural optimization, many opportunities have presented themselves.
“We’ve seen many newly emerged industries and a lot of great companies. As an investment institution, we want to seize business opportunities, to invest in these companies and to be able to grow together with these companies.”
He pointed out that healthcare, logistics, hightech and high-end manufacturing are among the sectors that have stood out during the Chinese economic restructuring.
“From the structure of our organization to the allocation of our resources, CCB International is actively searching for business opportunities from these sectors. We believe there will be many national and even world-class enterprises emerging from these sectors,” Hu said.
He explained that in terms of seizing business opportunities, CCB International will undertake the role of financial consultant for these companies, helping them solve developmental problems.
“We have also set up various funds, we have direct investment in Hong Kong as well as asset management products to help these companies meet their capital demands,” Hu said.
There are also great business opportunities related to the latest round of Chinese companies’ overseas M&A, he noted, adding that here too CCB International undertakes the role of financial advisor.
“The latest round of M&A is quite different from what we’ve seen before. Mainland companies used to acquire resources when they participated in overseas M&A, but recently, aside from acquired resources, we’ve seen that Chinese companies are interested in bringing back advanced technologies,” he explained.
“We’ve seen some consumer companies bring back new driving forces for themselves through acquisitions of foreign technologies. Some even acquired top- tier foreign companies in their field.”
Hu said that during overseas M&A, CCB International usually advises Chinese companies to pay special attention to valuation of the assets or company they are acquiring.
It would also remind the companies to consider whether the technology they want to buy could be applied on the Chinese mainland.
Hu said CCB International’s target is to continue to enhance its value as an investment service provider by improving related core products.
“We will also tap into the booming asset management industry, we will put more resources into expanding our business in this field. Meanwhile, we will also focus on exploring opportunities that arise along with the internationalization of the renminbi and the Belt and Road Initiative,” he said.
But while Hu is upbeat about prospects, he is also cautious, as any industry and business has its risks, he noted. Currently, the mainland economy is continuing to slow down and CCB International needs to avoid any wild fluctuations in the business, it needs to communicatete well with clients to carry outut risk management together,r, and also needs to be cautiouss about compliance, said Hu, who was one of the major founders of CCB International.
In the early 2000s, China Construction Bank Corp was preparing to set up CCB International and Hu participated in the process. “Even in those early days, we firmly believed that we would have great accomplishments as we were backed by our from domestic flights by charging travelers for just their carry-on luggage.
But anyone who has ever flown on the mainland would know that if he or she parent company and we were backed by the market of the Chinese mainland.”
Hu said he officially joined CCB International when it was set up in early 2004 and is glad to have watched it grow into a great investment institution.
Contact the writer at firstname.lastname@example.org is not among the first batch of passengers to board, the chances of finding any luggage space in the aircraft’s overhead compartments are virtually nil.
Hu Zhanghong, chairman and CEO, CCB International Hu Zhanghong said CCB International will aim to strengthen its asset management services and explore emerging opportunities related to the Belt and Road Initiative and internationalization of the renminbi.
Chinese mainland airlines could learn from US peers who did away with all the freebies that fliers in Asia still take for granted.