Huatai Securities’ US$4.5bn IPO in Hong Kong is the second largest in the world so far this year. But what does the listing mean for your career if you work in investment banking in Hong Kong? Here are three key takeaways:
1) Hong Kong is becoming increasingly attractive if you work in ECM
The Huatai listing makes Hong Kong the top destination for IPOs globally so far this year – it was previously fourth, with listing volumes at US$7.2bn, behind New York at US$9bn, according to Dealogic. This marks somewhat of a return to the turn-of-decade glory days for equity capital markets (ECM) bankers in Hong Kong, which was the leading market for IPOs globally between 2009 and 2011, according to the Wall Street Journal.
2) And you should consider covering FIG
Huatai’s IPO will add fuel to a financial institutions group (FIG) job market which is already starting to boom in Hong Kong. As we reported earlier this month, global banks in Hong Kong are increasingly recruiting senior FIG bankers to help them handle share sales and mergers from expansionist Chinese financial institutions like Huatai. Boosted by Industrial Bank’s US$2.1bn follow-on in February, financial services was the leading sector for ECM volume in China last quarter, with deals worth US$9.9bn, up from US$2.9bn in 1Q 2014, according to Dealogic.
3) Huatai itself will be hiring
If the post-IPO growth of other Chinese banks – in particular Haitong and Citic – are anything to go by, Huatai’s listing should lead to business expansion and more hiring. The firm has already been bolstering its senior ranks this year – it’s poached Patrick Ngan from UBS as head of ECM and Lu Ting from Bank of America Merrill Lynch as head of research.
Bank of China Hong Kong may be set to expand its headcount in Southeast Asia. (Bloomberg)
Deutsche’s Asia asset arm pitching for share of bank’s €1.5bn investment. (South China Morning Post)
Asian Infrastructure Investment Bank to be up and running by year end. (Straits Times)
China will launch mutual fund recognition with Hong Kong on July 1. (Reuters)
Can HSBC break with the past? (South China Morning Post)