UBS Group AG is likely to double its staff in China over five years, adding about 600 people as chief executive officer Sergio Ermotti bets a time of volatile markets is as good as any for boosting operations.
“China is not on its own with those challenges,” Ermotti said in a interview with Bloomberg Television in Shanghai yesterday. “Those are also the good times to plan for the future, and that’s the reason why we are starting to implement our strategic plan.”
The staff increases are to be in businesses, such as wealth management, investment banking, equities, fixed income and asset management, Ermotti said.
UBS is to start its biggest push in China against a backdrop of convulsions in the nation’s equity and currency markets and as some competitors pare back Asian operations. Barclays PLC and Standard Chartered PLC are scaling back, while Deutsche Bank AG co-chief executive officer John Cryan said last month that the region has “huge” competition for limited fees.
“China is a great opportunity like it has been for the last 20 years,” Ermotti said, adding that it would be a challenging year internationally. He declined to comment on the bonus pool for the company’s investment bankers.
UBS earned US$81 million in fees underwriting domestic Chinese bonds and equities and advising on mergers and acquisitions last year, up 42 percent from 2014 and the largest amount earned by the bank since 2012, according to Freeman & Co. UBS was the top non-Chinese bank for domestic investment banking for the first time since 2012, the New York-based research company said.
UBS ranked second in helping Chinese companies sell shares overseas last year, up from seventh in 2014, data compiled by Bloomberg show.
In 2006, the Zurich-based bank became the first foreign firm allowed to invest directly into a fully-licensed Chinese securities business, giving it a lead over rivals including Morgan Stanley and JPMorgan Chase & Co. UBS is awaiting regulatory approval for its banking license in Shanghai, its Asia Pacific chief Kathryn Shih said in an interview on Tuesday last week. The bank currently has a full bank license for Beijing, where it operates wealth management, she said.
Financial firms have been rocked by a roller-coaster ride in Chinese markets, with Chinese stocks soaring in the first half of last year before reversing so sharply that authorities intervened with support measures and investigations. The authorities are also wrestling with capital outflows and currency volatility as some investors try to profit from gaps between the onshore and offshore yuan rates.
Shares in Taiwan closed at a new high yesterday, the first trading day of the new year, as contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) continued to break records amid an artificial intelligence (AI) boom, dealers said. The TAIEX closed up 386.21 points, or 1.33 percent, at 29,349.81, with turnover totaling NT$648.844 billion (US$20.65 billion). “Judging from a stronger Taiwan dollar against the US dollar, I think foreign institutional investors returned from the holidays and brought funds into the local market,” Concord Securities Co (康和證券) analyst Kerry Huang (黃志祺) said. “Foreign investors just rebuilt their positions with TSMC as their top target,
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