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Investment banks in Asia cutting traders, hiring in M&A

job cuts

Investment banks haven’t finished cutting headcount, so say the big names at Davos. Bloomberg polled conference attendees and 83% believe that the banking industry will keep trimming jobs this year, with the largest proportion (21%) saying that Europe will be worst hit. This bleak prognosis doesn’t suggest that banks will continue to wield the axe at the same rate as recent years, nor does it provide an accurate picture of the situation in Asia, which is decidedly more mixed.

Banks in Asia are cutting – Chinese-owned brokerage CLSA is trimming 25 jobs in both the front and back office, Standard Chartered is shuttering its equities team in the region at the cost of 200 jobs (and cutting 4,000 retail banking jobs) and Nomura is reportedly cutting at least 12 jobs in its equities team. But these are relatively small cuts, and while investment banks’ trading divisions are being trimmed back, firms are hiring in other areas.

It’s staff in the markets businesses of investment banks in Asia who have the most to fear, believes Rachel Liu, associate director at the executive search firm Profile Search & Selection. “I think the cuts will continue,” she says. “I wouldn’t be surprised to see more cuts, which will be experienced within sales and trading businesses across major IBs such as structurers or the traders.”

However, Nomura is also hiring 20 senior bankers for its M&A business in the region. The value of M&A deals in Asia-Pacific hit record highs of US$202.5bn in the fourth quarter of 2014, according to Bloomberg data. Optimistic of a continued pipeline of deals, some investment banks are investing in staff, as we reported earlier this week. “Asia is a bit more bullish on M&A as it continues to be a rather profitable piece of meat for many banks within Asia,” says Liu.

Standard Chartered is making some deep cuts, and because it’s an emerging markets-focused bank, most of the job losses will happen across Asia, from Hong Kong and Singapore to Korea, India and Indonesia.

James Bridgman, a Singapore-based managing director at the executive search firm Laurus Group, says: “Other banks are not overly looking to down size here in Singapore as the teams are generally pretty slim as it is.”

Evelyn Lee, manager of financial services at recruiters Robert Walters, says that while some job losses will spill over from global banks cutting in other regions, significant cuts are unlikely in Asia.

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