The bankers who definitely won’t be quitting Hong Kong for Singapore

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As civil unrest sweeps Hong Kong, banking roles in Singapore are looking increasingly attractive to some job seekers. Overseas-based bankers who once only had their eyes on Hong Kong are now also open to Singapore, say recruiters. And as we noted earlier this month, Singapore is the overwhelming favourite ‘plan B’ destination for Hong Kong-based expats, if the territory’s crisis worsens and they eventually decide to relocate.

But as we’ve also reported, it’s not that simple to make a move between the two Asian financial hubs. While up to US$4bn in Hong Kong dollar deposits has flowed into Singapore in recent months, major banks have yet to relocate jobs from HK to SG in large numbers.

Moreover, there is one group of Hong Kong-based banking professionals who would probably never countenance moving south for career reasons: equity capital markets (ECM) bankers, in particular those working on new listings.

Hong Kong is the third largest IPO location globally so far this year (behind the Nasdaq and New York exchanges), with US$18.5bn raised in the city, according to data from Refinitiv. While Hong Kong took the top spot in 2018, its current position still puts it comfortably ahead of Singapore and other Asian markets. In contrast, Singapore is lagging in lowly 12th place, behind even Borsa Italiana and SIX Swiss Exchange.

If you’re an Asia-focused ECM banker, Hong Kong is clearly the place to work. Asia’s second biggest centre for IPOs, Shanghai, has raised less than half of Hong Kong’s year-to-date total.

That’s not to say that the job market in Hong Kong ECM is booming – far from it. While ECM bankers have largely avoided the recent redundancies at global banks in Hong Kong (these have mainly targeted equities traders), banks are not adding much new headcount in ECM, nor are they expected to early next year, says a Hong Kong IB headhunter. If you’re searching for work in the sector, you’ll probably end up replacing someone who’s left another bank, he adds.

That’s mainly because Hong Kong capital raising is down 42.8% year on year, despite the city’s continued dominance over Singapore and Shanghai. The ongoing protests have dampened the appetite of some investors and companies. In August, for example, Alibaba postponed its US$15bn Hong Kong IPO.

There have still been significant IPOs in Hong Kong since the protests began in June, most notably AB InBev’s Budweiser US$5bn APAC listing in September, the second-largest this year after Uber. “A robust IPO pipeline is anticipated to reverse the listing drought witnessed in the last two months and continue to show Hong Kong’s resilience as one of the best venues for initial public offerings,” senior Refinitiv analyst Elaine Tan told CNBC this week.

What are the best banks to work for if you want to do IPO deals in Hong Kong? CICC, Morgan Stanley, Citi, BNP Paribas and HSBC (in that order) are the top-five firms for Hong Kong-listed new-listing volume during the first nine months of 2019, according to Dealogic.

Image credit: tampatra, Getty

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