No doubt, if you look at the pipeline in Hong Kong, there are plenty of IPOs lining up. According to KPMG, The Hong Kong Stock Exchange raised a total of HK$87.3bn in the first half of 2020 – a 22% increase compared with the same period last year. It looks like it is going to be a busy time for equity capital market (ECM) teams.
More work for ECM teams
Recently, the American Senate passed a bill to delist companies that don’t comply with audits in May, which increased regulatory scrutiny of Chinese firms in the USA. As a result, it has prompted Chinese firms to choose Hong Kong over New York for their listings.
According to data from Refinitiv, fees from IPOs that American banks have received, follow-on share sales, and convertible bonds issued by Chinese companies – including the likes of retailer JD.com and tech group NetEase – have increased by about 24% year-on-year so far in 2020. With American banks also benefitting from helping their Chinese clients with their listings, the demand for talent in the ECM space should in theory be increased.
No major hiring in ECM teams
However, this has not been the case – banks have so far not expanded the teams that are working on these deals. The majority are maintaining their ECM headcounts with no additional hires and seeing how they go, taking a more reactive approach to hiring. Instead of actively increasing their headcount, they are instead open to selectively poaching top bankers who suddenly put themselves on the market.
Investment banks are transferring DCM and M&A desks to ECM
According to the investment banking talent experts at Selby Jennings North Asia, investment banks in Hong Kong are transferring staff into ECM teams from their quieter DCM and M&A desks. ECM hiring is set to eventually pick up, however if geopolitical tensions keep rising between the USA and China, Chinese firms listed in the USA may look to delist and relist in Hong Kong or China, which should keep investment banks busy in the region.
Investment banking jobs in Hong Kong
If you’re looking for an ECM role or other investment banking job in Hong Kong, take a look at our open opportunities. We are working with multiple firms with urgent hiring needs, so if you are immediately available and open to exploring more, please submit your CV to us.