In­vest­ment banks in HK hir­ing sea­son be­gins


In 2017, the big in­vest­ment banks started to think about grow­ing, but the pace of hir­ing will re­ally pick up this year, say an­a­lysts, as the banks hope that strong pro­jec­tions for eco­nomic growth in the re­gion, es­pe­cially in China, and reg­u­la­tory changes in Hong Kong, will com­bine to drive in­creased rev­enues.

"It is the first time in at least the last four years that we have seen this level of op­ti­mism," said John Mul­lally, who runs re­cruit­ment firm Robert Wal­ters' fi­nan­cial ser­vices prac­tice in Hong Kong and Shen­zhen. "Nor­mally this time of year would be a quiet one when it comes to hir­ing, but many of the banks are mak­ing plans now so that they can hit the ground run­ning early next year."

Mul­lally said that ar­eas where he saw par­tic­u­larly strong de­mand for new hires were in banks' in­vest­ment bank­ing di­vi­sions, par­tic­u­larly their TMT (tech­nol­ogy me­dia and tele­coms) teams. "They are also look­ing for Man­darin speak­ers, with about six to 10 years ex­pe­ri­ence. The types of peo­ple who are able to look af­ter a deal with­out much hand hold­ing from se­nior man­age­ment, but also are not that ex­pen­sive," he said.

The de­mand for TMT bankers was driven be­cause of a num­ber of high pro­file tech list­ings in Hong Kong in the lat­ter half of 2017, such as on­line in­surer ZhongAn On­line Prop­erty & Ca­su­alty In­sur­ance and on­line pub­lisher China Lit­er­a­ture. It is a theme that will re­main im­por­tant in 2018. "It's a very ex­cit­ing time for the Hong Kong mar­ket," said Tucker High­field, head of Credit Suisse's eq­uity cap­i­tal mar­kets syn­di­cate in Asia-Pa­cific.

"2016 was a low wa­ter mark for ECM ac­tiv­ity in Hong Kong, and un­til re­cently if peo­ple wanted to in­vest in tech­nol­ogy in Hong Kong, there were only one or two op­tions. How­ever, this has now changed and in­vestors have more op­tions avail­able to them, par­tic­u­larly with the re­cent IPOs in the fourth quar­ter, and the list­ings of Chi­nese tech­nol­ogy com­pa­nies that are likely to come in the fu­ture.

"The change of the rules around dual class shares, which is a sig­nif­i­cant de­vel­op­ment for the ex­change, will only make this trend more pro­nounced." In De­cem­ber, the Hong Kong stock ex­change an­nounced new rules to al­low com­pa­nies to list with two classes of shares, some with more vot­ing rights than oth­ers.

Carl­son Tong Ka-shing, chair­man of Se­cu­ri­ties and Fu­tures Com­mis­sion, Hong Kong's se­cu­ri­ties reg­u­la­tor, said that fol­low­ing the rule change he hoped at least one gi­ant tech name would list in the city in 2018. Tech­nol­ogy com­pa­nies like Ant Fi­nan­cial, Alibaba Group Hold­ing's fi­nance busi­ness, Ping An In­sur­ance (Group)'s on­line wealth man­age­ment and lend­ing plat­form Lu­fax, and smart­phone maker Xiaomi are all po­ten­tially go­ing to list next year, though which bourse they will choose re­mains up for grabs.

More pos­i­tive sen­ti­ment is also ex­pected when it comes to merg­ers and ac­qui­si­tions trans­ac­tions, which were hard hit in the first half of last year by tighter rules on the main­land about out­bound in­vest­ment. Law firms like Baker McKen­zie and pro­fes­sional ser­vices play­ers EY and PwC are all ex­pect­ing Chi­nese out­bound M&A trans­ac­tions to in­crease this year, pro­vid­ing more work for the banks.

Nor are banks only look­ing to hire deal mak­ers. J.P. Mor­gan for ex­am­ple, said it boosted its Greater China eq­uity re­search team by 20 per cent last year, and is hop­ing to grow by a fur­ther 30 - 40 per cent this year, and fur­ther still in 2019.

"We are look­ing at sig­nif­i­cant lev­els of hir­ing," said James Sul­li­van, head of Asia ex Ja­pan eq­uity re­search at J.P. Mor­gan. "We are see­ing an ex­pand­ing in­ter­est in the A-share mar­ket on the back of MSCI in­clu­sion.

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