Mark O’Reilly
Mark O’Reilly: ‘Anything to do with risk and compliance is still very hot’

Across Asia and particularly in Hong Kong, banks want people with native language skills, especially Mandarin Chinese – or Putonghua, as it is known in China.

In investment banking this is almost exclusively the case, according to recruiters, while on the markets and trading side there is still some room for westerners without the local lingo.

The number of roles across banking in Asia has been shrinking steadily for the past three years, according to Coalition, the research group.

Increased automation of some functions, including trading, and poor overall deal activity has hit fees and highlighted the now excess resources added during the previous years of big Chinese state-owned enterprise listings.

However, this January, hiring finally began to pick up again at least in more junior roles, as the work investment bankers did to line up and prepare deals while markets were quiet looks likely to move into its execution phase.

Adam Jeffes at financial recruitment firm Morgan McKinley in Hong Kong notes that this January was the company’s busiest for three years.

But he says banks were mainly looking for staff at the vice-president and director level, rather than more senior managing directors. Other headhunters gave similar accounts.

But many of these jobs are for Chinese who have experience or education abroad and are native Mandarin speakers. “Even on the markets side, the mid to senior management still tend to be European or American, but from the second-in-command down, it is increasingly local or extremely good Mandarin speakers,” says Mr Jeffes.

“There are a lot of people in the UK and US trying to get out here, but unless you have a lot of political equity, or a big sponsor, it is very hard.”

Across Asia, fixed income trading and the core investment banking jobs of origination and advisory have seen declines every year since 2010, according to Coalition.

The former has seen total jobs among the top-10 banks fall from 4,350 to 3,600 between the end of 2010 and the end of last year, while the latter has gone from 4,100 to fewer than 3,500.

Equities jobs saw similar declines until a small uptick last year that was mainly due to the resurgence of Japanese equity markets.

The declines partly reflect the fact that many aspects of the broking, or sales, side of the business are becoming automated to a much greater degree. The junior bankers of today need to be much more highly skilled than was the case before.

“What we need is hedge-fund type guys, people who can really connect the dots,” one headhunter says. “The industry as a whole needs to do more with less; it needs guys with higher utility.”

However, risk control and compliance are still seeing a lot of activity, with banks in Hong Kong and Singapore looking for senior people with experience, while they continue to offshore more junior jobs to countries such as India.

“Anything to do with governance, risk and compliance is still very hot,” says Mark O’Reilly of recruiter Astbury Marsden in Singapore. “The pressure on boards to meet all these new standards is creating lots of mandates to hire risk and internal audit staff.”

The other big bright spot is within China itself, where many markets are only just developing and there is a real dearth of skills and experience. The big problem here is that westerners generally do not work well in these roles as the cultural differences and the gap in language and communication skills are usually just too great.

Some bank executives in China believe this could threaten the very development of the industry itself. Eric Ren, a senior director at Haitong Securities, says the lack of personnel and skills in the market could hamper the development of some sectors, particularly more technical areas such as futures or options trading and broking.

“There is a problem of shortage of personnel that will persist for a long time. Options are very high tech and complex and a lack of skills can be a fatal bottleneck for the market,” he says.

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