By Sumeet Chatterjee and Scott Murdoch
HONG KONG (Reuters) – Bank of America Corp <BAC.N> will recruit about 50 bankers for its investment banking team in Asia this year, as it pushes to bolster its dealmaking business and shore up revenues from the unit, three people with direct knowledge of the matter said.
Bank of America’s (BofA’s) Asia headcount expansion comes against the backdrop of a subdued recruitment outlook for the broader investment banking business as global lenders grapple with cost pressures and slowing M&A momentum.
A third of BofA’s new hires in Asia will be senior bankers, including managing directors, for its merger and acquisitions advisory and capital markets businesses, mainly in Hong Kong, Singapore and Australia, the people told Reuters.
BofA’s hiring tally for the year could change depending on the deals’ momentum, said two of the people, who spoke on condition of anonymity as the plans are still confidential.
A BofA spokesman in Hong Kong declined to comment.
Deals involving Asia-Pacific firms worldwide fell in 2019 amid the U.S.-China trade war and tighter regulatory scrutiny. But after a Phase 1 agreement between the world’s two biggest economies, trade tensions have eased, which should bode well for dealmaking.
Bankers see Chinese state-owned companies playing a major role in dealmaking in 2020, and expect large floats including a potential listing of Ant Financial, an Alibaba <BABA.N> <9988.HK> affiliate, to buoy capital markets activity.
With the renewed focus on investment banking, BofA is aiming to break into the top four of Asian investment banking advisory league tables in the next few years, the people said.
“The bank’s coverage footprint (in Asia Pacific) is smaller than bigger rivals,” one of the three people said, adding BofA’s hiring has to increase to reduce the gap in coverage of industrial sectors and clients in the region.
BofA is the second largest bank in the United States, with consumer banking its biggest business.
INVESTMENT BANKING FOCUS
BofA’s recruitment drive for the investment banking unit comes as it struggles with falling market share and revenue, as well as a string of departures of senior leaders in the United States and Asia in the recent past.
The Wall Street bank promoted its Asia Pacific president Matthew Koder to global head of corporate and investment banking in late 2018 and tasked him with revitalizing its corporate and investment banking business.
Koder, an Australian who started out at Goldman Sachs <GS.N> in the mid-1990s, has made significant changes to the business in the past year and stepped up hiring in the bank’s home market as well as in Europe.
In Asia, senior hires in 2019 included Patrick Steinemann, who came on board as BofA’s head of industrials investment banking team, while Monica Chang joined the China coverage team from Deutsche Bank <DBKGn.DE>.
Overall, BofA expanded its investment banking headcount in Asia last year by hiring about a dozen senior bankers, making it one of the most aggressive recruiters among other global banks in the region, one of the people said.
The Charlotte, North Carolina-based firm reported a 9% rise in investment banking fees in the fourth quarter ended December to $1.5 billion, on higher income from debt and equity underwriting deals.
BofA was third in the Asia Pacific M&A advisory league table including Japan in 2019, but it was ranked ninth in the equity capital markets table and did not feature in the top 20 debt capital market rankings, according to Refinitiv data.
(Reporting by Sumeet Chatterjee and Scott Murdoch in Hong Kong; Editing by Himani Sarkar and Susan Fenton)