Morning Coffee: The new driver of senior Asian investment banking jobs

Chinese M&A, both inbound and outbound, increasingly appears to be a good sector to work in. Banks are already hiring more bankers to advise Chinese companies expanding overseas, but they now also need more M&A staff who can help overseas investors looking for mainland acquisitions as China restructures its state-owned enterprises (SOEs). The total amount of M&A deals targeting Chinese companies has reached a record high of US$143.5bn so far this year – up 61% from the same period last year, according to Dealogic.

“We are set to see many more M&As related to Chinese companies in the following months. It is the government’s intention to reform state-owned enterprises by encouraging them to merge among themselves to get bigger and enhance their competitiveness,” Christopher Cheung Wah-fung, a Hong Kong Legislative Council member representing the financial services industry, told the South China Morning Post.

“This reform of state-owned enterprises also means the government would allow overseas investors to take stakes in mainland firms. This would allow Chinese companies to raise capital for further expansion. At the same time, overseas investors can also bring in their management and technology to upgrade mainland companies,” Cheung added.

Whether the deals are inbound or outbound, however, banks face the same challenges when looking to bulk up their M&A ranks: there’s a shortage of senior bankers with the type of cross-border skills (think, Mandarin speakers with a Western education and mainland networks) that are now so sought after.

Both Western and Chinese banks are essentially competing for the same experienced M&A bankers. As we noted in March, for example, new CICC chief executive and chairman Bi Mingjian is tipped to recruit more bankers to work on cross-border mergers. “It’s a quiet job market in IBD overall, but the demand for Chinese bankers with cross-border expertise is still strong,” an investment banking headhunter told us at the time.

M&A bankers in China should also get used to working on larger-sized deals. Mega deals, those worth over US$1billion, made up about 57% of the year-to-date M&A total, according to Dealogic.

Meanwhile:

David Chin, UBS head of Asia investment banking, is retiring. (Reuters)

Shenzhen-Hong Kong stock connect may be announced this quarter, says UBS report. (Straits Times)

Virtu Financial, one of the world’s biggest high-frequency trading firms, is trying to break into China. (Wall Street Journal)

Why Asia leads the world when it comes to women in senior management roles. (South China Morning Post)

Rurik Jutting, the British banker accused of murdering two Indonesian women in his Hong Kong flat, is to appear before the territory’s High Court. (Telegraph)