Such is the demand for Hong Kong-based China research analysts that banks are sometimes doubling or even tripling base salaries to clinch these candidates. Banks in Hong Kong want to hire young Western-educated analysts who speak Mandarin and English, but competition is so intense that some candidates have been able to negotiate three-fold pay rises, reports the Financial Times.
“They want to find someone they can put in front of investors in Boston or San Francisco without losing any of that Chinese expertise,” Marlon Sanchez, head of Asia prime finance distribution at Deutsche Bank, told the FT. “These individuals over the next five years are going to be some of the most important as we try to right-size the amount of time we spend on China.”
Shanghai-Hong Kong Stock Connect has helped open up the Chinese market to foreign investors, fuelling demand for more research into Chinese companies.
As we reported in March, Morgan Stanley kick started the scramble to hire China analysts in Hong Kong and now HSBC is following suit. The bank is currently recruiting 10 to 15 new analysts to cover Chinese stocks, according to the FT. More hiring could follow as the dynamics of investing in the region shift further towards China, William Bratton, HSBC’s head of Asia-Pacific equity research, told the FT.
While Morgan Stanley and HSBC have openly revealed their intentions to hire more China analysts in Hong Kong, other banks are doing so with less fanfare. “Firms like UBS, Credit Suisse, Nomura and BNP Paribas have been busy interviewing analysts this year to strengthen their China coverage in industries like consumer, technology, infrastructure, healthcare and financial institutions,” a headhunter with knowledge of these banks told us in March.
Chinese brokerages, insurers and asset managers are also looking to expand in Hong Kong, generating even more demand for bilingual analysts, reports the FT. Huatai Securities, for example, recently poached Lu Ting from Bank of America Merrill Lynch as its new head of research.
China-focused equities traders are also in demand in Hong Kong, as we reported yesterday, although they aren’t enjoying quite the same salary hikes.
Nick Leeson says Stock Connect could increase ‘rogue trading’ risks. (South China Morning Post)
Veteran expat investor Jim Rogers on why he still loves Singapore and sends his kids to a local school. (Wall Street Journal)
Hang Seng to sell stake in Industrial Bank for US$2.7bn. (Business Times)
Hong Kong Hedge Fund Azentus suffering from shrinking assets. (Wall Street Journal)
Hong Kong’s SFC to crack down on market manipulation. (South China Morning Post)
Why Singapore could lose its competitive edge as a low-tax hub. (Today)