China’s regulators recently allowed state-owned enterprises (SOEs) and international private equity (PE) firms to collaborate on overseas investments. eFinancialCareers talks to Alex Eymieu, partner, CTPartners Hong Kong, about what this could mean for financial professionals.
What has the PE and SOE employment market been like this year?
The level of capital available or raised recently in China has given the PE industry some renewed activity, but not sufficient to create fresh demand in employment. Experienced senior executives may move from one PE firm to another to access fresh capital, but we do not see a significant increase in demand. Local SOEs continue to attract entry-level analysts, VPs and a few directors due to their continuous growth. In fact, SOEs are becoming the employer of choice for university graduates.
Will increased collaboration between SOEs and PEs mean a greater demand for talent?
Local RMB funds are small in both PE and real estate [RE], and this creates some need for execution and management teams, but not really for investment teams or leadership. As for regional and international business development by Chinese companies through Hong Kong, we forecast a lot of increased activity in the future. But for the moment, it is still considered somewhat sensitive at headquarters and the lack of visibility in the economy has put a lot of major development projects on hold.
Which job functions will be most sought after?
Most of the demand for candidates these days is around auditing, legal and compliance, deal sourcing, corporate banking leadership, relationship management, product solutions, fund management and research.
With ongoing redundancies in banking, is it possible for unemployed bankers to find work in PE firms and SOEs?
It is possible for bankers to join the PE industry in China, if they are covering clients, have an industry specialisation and existing relationships, or if they are in execution teams. Yet the demand is not high for reasons mentioned above. Most times, the pay is lower than in banking as the structure is different; base salaries are similar but year-end bonuses in cash are much lower in PE as value is transferred into long-term carry at the maturity of the fund or investments.
Are these firms receptive to hiring expat professionals or is Mandarin a must?
Mandarin speaking skills are important. For expatriates, the importance of being able to speak Mandarin proficiently is usually judged on a case-by-case situation depending on the function of the role.
What will hiring be like in financial services in China for the rest of the year?
There is a lack of visibility in the volume of demand in financial services, but we see a clear shift in demand. Capital services and wealth management should do fine. The buy side, PE, RE and asset management in general, will do opportunistic hiring to consolidate their positions; it will be less about managing growth. Regional banks will continue to expand and recruit talent. Chinese institutions will also increase their presence and offerings. On the other hand, the major (non-Chinese) multinational banks will probably focus on cost controls, risk management, and their core markets globally, which is likely to limit their ability to grow in China.