Yet another bank in Asia – this time it’s Mitsubishi UFJ Financial Group – has axed trading jobs. The departing traders will have a hard time finding work, especially if they want to join another large bank, say headhunters.
MUFG is laying off about 60 employees, which accounts for just under 40% of staff at its securities business in Hong Kong, Singapore and Sydney, reports Bloomberg. The swathing cuts affect equities, credit trading and structured products and are the result of a review into the firm’s underperforming global sales and trading business. A spokesperson for MUFG confirmed the redundancies.
A statement from the Japanese bank attributes the cuts to a “challenging market environment” and says the firm needed to “optimise” its operating model while remaining committed to its Asia ex-Japan business.
Former MUFG equities traders may find themselves facing the most arduous job search, following more than three years of relentless job cuts in their function at firms such as Barclays, Standard Chartered and Credit Suisse. The redundancies arguably reached a peak last quarter when BNP Paribas, Morgan Stanley and Nomura trimmed their Asian equities operations. In early July, Deutsche Bank announced it was shuttering its Asian equities business, alongside those elsewhere in the world.
“I don’t expect ex-MUFG traders to get picked up by big banks in Asia. They’re not going to go to a Goldman or a Morgan Stanley,” says Hong Kong-based trader-turned headhunter Matt Hoyle. “All traders who’ve been cut are struggling in the current job market, and MUFG isn’t a big player in Hong Kong equities or Singapore equities,” he adds.
Singaporean banks DBS and OCBC might “taken on a couple of MUFG people here and there”, says Hoyle, but Chinese banks in Hong Kong are unlikely to do the same.
While the US-China trade war, the ongoing pro-democracy protests, and the faltering mainland economy are affecting the job market in Hong Kong, Hoyle says ongoing automation of trading systems is largely to blame for continued redundancies in equities. As we’ve previously reported, both Goldman Sachs and JP Morgan are expanding their equities-focused technology teams in Hong Kong. The Asian equities market became more “electronified” last year, according to a report by Greenwich Associates.
Many of those leaving MUFG in Singapore and Hong Kong will likely have to shift into a different job function. “I’ve seen traders moving into structuring roles at private banks and into treasury functions within corporates,” says Stanley Soh, a Hong Kong-based director of Asian financial services solutions.
“Moving to the buy-side in a trading role is the preferred exit route, but it’s very competitive,” he adds.
Another, perhaps less obvious, career option for ex-MUFG traders is to join one of the eight new digital banks which have been granted licences to operate in Hong Kong and are set to go online late this year or early next year. “They may be retail focused at first, but they will also go after corporate and institutional clients. I actually think traders will ultimately be in demand at the virtual banks,” says Hoyle.
Image credit: winhorse, Getty
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