Sat, Jan 11, 2020 - Page 10 News List

JPMorgan, Nomura take extra Chinese office space

‘VOTE OF CONFIDENCE’:The firms have been at the fore of Beijing’s financial opening, and plan to build their asset-management and securities businesses

Bloomberg

JPMorgan Chase & Co and Nomura Holdings Inc are taking extra office space in China, with both increasing headcount in the nation as it opens its US$45 trillion financial industry to more competition.

New York-based JPMorgan is boosting its space in Shanghai Tower, China’s tallest skyscraper, to 20,000m2 from 15,000m2, people familiar with the matter said.

Nomura, Japan’s biggest brokerage, is nearly doubling the size of its lease to about 5,000m2, the people said, asking not to be identified because the details are not public.

Both institutions have been at the fore of China’s financial opening, laying out expansive plans to build their securities and asset-management businesses in Asia’s largest economy, and hiring along the way.

As the liberalization gathers pace, it is presenting the firms and their peers, such as Goldman Sachs Group Inc and BlackRock Inc, with a tantalizing opportunity to more easily compete for a slice of the nation’s ballooning wealth.

JPMorgan’s expansion comes less than a year after it relocated to Shanghai Tower in the city’s financial district because it needed more room. The lender has been hiring, a person familiar with the matter said, without giving details.

“This is a strong vote of confidence in their China business,” Jones Lang LaSalle Inc head of China research Daniel Yao (姚耀) said. “Foreign asset management companies have been at the forefront expanding in Shanghai.”

The office expansion is part of a long-term plan after the bank announced last year that it wanted to have all its Shanghai-based employees in one building, JPMorgan said in an e-mailed statement.

A Nomura representative declined to comment.

As of this month, foreign companies can apply for 100 percent control of insurance and futures ventures in China. In April, overseas players would be able to apply for licenses to start wholly owned mutual fund management firms.

Global firms could invest 7 trillion yuan to 8 trillion yuan (US$1.01 trillion to US$1.15 trillion) in Chinese assets over the next few years, the China Center for International Economic Exchanges said.

JPMorgan and Nomura both already have majority-owned securities ventures in China.

Nomura last month said that it expects its local headcount to climb to 500 by 2023 as it builds its wealth management business and expands into investment banking.

JPMorgan chief executive Jamie Dimon has said the bank is committed to bringing its “full force” to China.

Additional office requirements from foreign financial institutions would spur strong demand in Shanghai’s office leasing market this year, helping ease elevated vacancy rates, CBRE Group Inc astern China head of research Ivy Lu (李婉菁) said.

Vacancy rates in the financial hub spiked to 19.4 percent at the end of last year, the highest level since the depths of the global financial crisis in 2008 to 2009, CBRE said.

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