© Reuters. FILE PHOTO: A Star Ferry boat crosses Victoria Harbor in front of a skyline of buildings in Hong Kong, China, June 29, 2020. REUTERS / Tyrone Siu
By Scott Murdoch, Alun John, and Kane Wu
HONG KONG (Reuters) – Some global banks, funds and other financial services companies say they are stepping up recruitment in Hong Kong, a sign that the city’s unique position as a financial gateway to China outweighs concerns about Beijing’s tightened control.
Goldman Sachs Group Inc (NYSE :), City group Inc (NYSE :), UBS AG and other banks are each hiring hundreds of people in the city this year, significantly expanding their existing ranks.
Citigroup, for example, has announced that it will increase its workforce by 1,500 people, including additional employees and replacements in 2021, twice as many as a year ago. It has about 4,000 people in the city. A Goldman spokesman said the bank, which employs approximately 2,000 people in Greater China, expects new hires in Hong Kong to increase 20% this year.
The Securities and Futures Commission, Hong Kong’s market regulator, is seeing a recovery in the licenses it issues to those involved in asset management, securities and other financial activities, according to information on its website. The total number of licenses issued rose 1.7% at the end of March compared to nine months earlier and was just below an all-time high in 2019.
“Hong Kong has some unique advantages and will remain the gateway to China for many of our local and global customers,” said Kaleem Rizvi, head of Citi’s Asia-Pacific corporate bank.
Many financial firms have slowed employee recruitment over the past year after protests against Chinese rule and a new security law were imposed on the city to crush dissenting views on Beijing and the coronavirus pandemic, six bankers, recruiters and other executives said the branch.
The increased hiring plans of some of the big players show that they are now ready to live with the political risks.
“Everyone in the business community I’ve spoken to welcomes the peace and stability now compared to the chaos of 2019,” said Weijian Shan, chairman and chief executive of Hong Kong-based private equity group PAG.
Certainly the policy remains controversial and worrying for some finance professionals, some bankers said. Some foreign financial workers have left Hong Kong or are considering leaving Hong Kong along with thousands of residents of the former British colony.
The Hong Kong police have asked some banks to release the account details of opposition activists and politicians arrested under a strict national security law imposed by Beijing, and the government has threatened bankers with prison terms for handling assets of media magnate Jimmy Lai, which was released after the new law are frozen.
Hong Kong’s financial regulators declined to comment on bank hiring plans or some bankers’ unrest over political tightening.
Bankers and other financial services firms polled by Reuters said much of the lure to be in Hong Kong came from the city’s close ties with China and the dealings that go with it.
This business is booming. Flows through the stock connect programs that link Hong Kong to the Shanghai and Shenzhen stock exchanges rose to record highs in the first quarter of 2021.
Firms, mainly in mainland China, raised more money from listings in Hong Kong in the first five months of this year than in the same period of the past four years combined, Refinitiv data shows. Mergers and acquisitions in Greater China are the highest since 2018.
Anthony Fasso, Asia Pacific head of global asset manager PineBridge Investments, said Hong Kong is adjusting to the new realities. “We believe that Hong Kong will remain a globally competitive international city on the doorstep of one of the largest and fastest growing economies in the world,” said Fasso.
In addition to Goldman and Citigroup, the Swiss bank UBS hired 200 employees in the year to March, 20 new full-time employees compared to seven in the previous year, a spokesman said.
The bank hired 100 contractors and 80 college graduates in the year ended March. It was the highest number of college graduates to join UBS in more than 10 years. The bank has 2,500 employees in Hong Kong.
HSBC stocks Plc (LON 🙂 has announced it will hire 400 people in Hong Kong this year as part of its plan to hire 5,000 people in the region to manage wealth in Asia over the next five years.
Lok Yim, Hong Kong head of Deutsche Bank AG (NYSE :), said the German bank was also planning further strategic hires after the strongest first quarter in years.
“We’re probably two to three times as busy now as we were at the end of last year,” said Olga Yung, regional director of Hong Kong recruitment firm Michael Page.