Hong Kong’s government is in a contemplative mood when it comes to financial services. As we noted yesterday, it is planning a training and internship programme to tackle skill shortages in the industry, especially in private banking – a sector where it faces strong competition from Singapore.
Hong Kong is set to up its game against Singapore in another sector too – and this time its tactics are more concrete and less HR focused. It’s implementing broad changes to its tax regime to make it a more attractive centre in Asia for global companies to trade foreign exchange and (ultimately) to dislodge Singapore as the region’s FX hub. “With the liberalisation of the RMB (yuan), Hong Kong has a significant opportunity to close the gap with Singapore, but to capture its share of corporate FX flow it needs to attract more corporate treasury centres,” James Badenach, financial services tax partner at EY in Hong Kong, told Reuters.
Time will tell whether the tax changes are enough to prompt in-house corporate-treasury jobs to be relocated from Singapore to Hong Kong, let alone FX jobs at banks. In theory, however, these roles are more easily transferable than many other positions in financial services. “They are focused more on technical FX skills than on local client relationships, so employees have more flexibility to move markets,” says a recruiter in Hong Kong.
Separately, details of more job cuts at CIMB are slowly emerging. We reported early this month that Asian redundancies were on the cards as the Malaysian firm announced plans to reduce investment banking costs by 30%. Now Bloomberg is reporting, quoting anonymous sources, that the reductions will involve mostly equities-related positions in places including Hong Kong, Taiwan, India and South Korea. Recruiters we spoke to earlier expected the layoffs to be more substantial, so 50 may be the tip of the iceberg.
Some sales and trading jobs will stay in Singapore as RBS makes major cut-backs. (Wall Street Journal)
Why digital banking is about to boom in Singapore. (Asia One)
500 mainland-domiciled funds will be allowed to trade in Hong Kong under new cross-border programme. (South China Morning Post)
Maybank’s Q4 profits rise 11.5% as income from Islamic banking increases. (Reuters)
Hong Leong Finance reports a 10.4% drop in full-year net profit. (Business Times)
Call for Singapore to reveal average incomes of permanent residents. (Asia One)
Yuan strengthens its position as the second most used currency in documentary credit transactions. (South China Morning Post)