Bleak Christmas looming for Asian bankers
Bleak Christmas looming for Asian bankers
Bernice Han, Agence France-Presse, Singapore
Christmas will be bleak for Asia's once high-flying international bankers as major institutions push ahead with plans to trim their presence in a region still struggling to recapture its glory days prior to the 1997-98 crisis.
After nearly three years in a fruitless wait, financial houses have decided it is no longer worth their while to expend precious resources in the region, especially Southeast Asia, at the expense of the seemingly limitless opportunities in China.
"It will be tough. There will be layoffs in the future," Julian Leung, a Hong Kong-based equity strategist at ING Barings, told AFP.
U.S. financial giant JP Morgan Chase, formed as a result of Chase Manhattan Bank's acquisition of JP Morgan last year, said it would be directing more effort into China now that Beijing has gained membership of the World Trade Organization (WTO).
Most financial houses are blaming the lackluster performances of the region's stock markets for the decision to scale down their presence.
Brokerage Indosuez WI Carr Securities' deputy chief executive Philip Desgranges said the "poor trading business" in Asian stock markets drove the company to close research and brokerage operations in the region.
The closure will see 50 of the 140 staff losing their jobs in Hong Kong, he said.
Elsewhere in the region, the countdown to Christmas is also grim even for those whose companies have yet to retrench staff.
"We've done well enough to justify our presence here. But nobody here is a sacred cow and to think that it (job-slashing) won't happen to us is a bit out of reality," an associate director at PT UBS Warbug Indonesia told AFP on condition of anonymity.
"I don't think anyone is looking for bonuses but we (have been told we) will receive them anyway."
A technical analyst with Vickers Ballas Securities said most investment bankers and employees of securities firms were "very obviously concerned with downsizing" as the impact of the global economic recession bites.
"They are constantly thinking about whether the headquarters of their respective companies deem their operation in Indonesia still profitable or not," the analyst said.
He cited the recent closure of the Hong Kong and Shanghai Banking Corporation's (HSBC) stockbroking operations in Jakarta, and of Nomura Securities in the city, as "obvious examples of the gradual impact of the global economic recession in Southeast Asia."
In Japan where the economy clings stubbornly to a decade-long slump, financial institutions are also planning to cut down their operations.
Early this month, Morgan Stanley Dean Witter and Co. announced it was making a hasty retreat from Japan's retail brokerage market a mere 10 months after it began its operations in Tokyo.
Its announcement followed Dutch outfit ABN Amro's September decision to shut down its domestic Japanese equities business "with immediate effect," cutting 100 jobs in Japan and 20 elsewhere from a 250-strong workforce.