If you work in equity capital markets (ECM) in Asia, chances are that you’re based in Hong Kong, not Singapore. Hong Kong overtook New York last year to regain its mantle as the world’s biggest market for new listings. The city’s stock exchange is the fifth largest in the world, while Singapore’s sits outside the top 20.
But although Singapore is never likely to topple Hong Kong in ECM, a new government initiative means banks in the city state will step up their ECM hiring in the near future, say recruiters. Whether Singapore has enough ECM bankers to cope with the extra demand, however, is unclear.
Last week the Monetary Authority of Singapore (MAS) unveiled its S$75m Grant for Equity Market Singapore (GEMS), a three-year plan to help businesses seeking to raise capital through Singapore’s equity market. Government-back schemes to boost the finance sector, even if otherwise successful, don’t always translate directly into new hiring, but recruiters say GEMS is different.
The programme, which takes effect on 14 February, has three components, but it is the first – a listing grant to help defray initial public offering (IPO) costs for companies wanting to list on the Singapore Exchange – that is most likely to affect ECM hiring.
“Over the past few years in Singapore, hiring in ECM has been very sporadic due to a low demand for these bankers,” says Serena Fernando, a financial services consultant at recruiters Robert Walters. “This grant will not only enhance our private and public markets, but will also encourage more listings among local and foreign enterprises, which will in turn lead to a demand for ECM bankers to raise capital and work on these IPOs.”
ECM bankers who specialise in technology will be most in demand as the MAS initiative gives companies in this sector the most generous subsidy of their IPO expenses, says Mark Li, a client solution director at recruitment firm Randstad in Singapore. Companies in what MAS calls ‘high-growth’ industries (e.g. advanced manufacturing and healthcare) can also potentially qualify for larger listings discounts. “This expected increase in IPOs will result in finance firms increasing their ECM headcount, because tech and high-growth companies will need more IPO services from investment banks and from corporate-finance firms like the Big Four,” adds Li.
Which banks will be hiring? Any uptick in Singapore IPOs will largely benefit banks already established as market leaders, says a headhunter in the city state. Credit Suisse is among the frontrunners, having topped Dealogic’s volume tables for Southeast Asia ECM in both 2017 and 2018. Morgan Stanley took second spot for the region last year. DBS, however, could be even better placed to win more deals, and potentially hire more bankers. It placed third for 2018 ECM volume across Southeast Asia, and its status as a local bank means it could attract more business from local tech companies looking to list in Singapore.
Where these banks will get their new staff from remains unclear. “The ECM talent pool in Singapore is very small to start with, and ECM bankers need to have an in-depth understanding of local regulations,” says Li. “Competition for talent will heat up if there’s a significant increase in IPOs. To address this demand, we may see talent from peripheral specialisations and organisations, such as candidates from regulatory and audit firms, fill new roles at banks,” he adds.
“Singapore has enough talent to fulfil demand for junior positions, but for mid-level jobs and above, the pool is smaller,” says Fernando from Robert Walters. “At this level banks could hire more overseas-based Singaporeans looking for ECM opportunities back home.”
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