Morning Coffee: Chinese bank plans major HK/SG hiring spree, but may struggle to attract talent

If you’re looking to join an expanding private bank in Asia – or for that matter Europe, Canada or Australia – you may want to add a rather surprising new name to your target list: China Merchants Bank. The firm’s private banking unit is now planning a “major global expansion that will eventually pit the eight-year-old operation against some of the world’s most storied private banking institutions,” the South China Morning Post reported yesterday.

China Merchants’ private bank, which officially opened its doors in Hong Kong last month, is now due to set up in Singapore by December and is looking for acquisition targets in Europe, Cai Canhuang, a senior vice-president at the bank, told the SCMP. Cities where the firm also wants to operate in include London, Luxembourg, Vancouver and Sydney.

The expansion plan comes as assets under management (AUM) at Merchants’ private bank jumped about 29% in the year to May, helped by aggressive investment in China’s surging stock markets. However, mainland private banks will have their work cut out for them in the global market, Cai told the newspaper – about 90% of Merchants’ own private AUM are currently based on the mainland. Its expertise in global markets will now largely be forged from Hong Kong.

Cai gave no hiring targets, but the firm is bound to face recruitment challenges when it tries to expand in Hong Kong and Singapore. It is currently not in the top-20 for either AUM or headcount in Asian private banking and the sector’s job market is already highly competitive and short of talent. Its lack of market penetration – Chinese firms are not yet renowned for their private banking prowess – will mean that many bankers currently based in Hong Kong and Singapore will consider joining Merchants to be a risky career move.

China Merchants may instead be tempted to lure mainland-based private bankers to join its ranks in Hong Kong and Singapore. As we reported last month, successful Chinese private bankers often aspire to move themselves (and their clients) to the more developed and lucrative Hong Kong market. The may well grab the opportunity to relocate with Merchants.

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