China’s Citic Securities is reportedly planning to move dozens of bankers from Hong Kong to the mainland in order to cut costs.
Citic Securities plans to relocate dozens of bankers from its Hong Kong unit CLSA to mainland China, according to a «Reuters» report citing unnamed sources. Cost reduction and support for Beijing's efforts to bridge income inequality in the financial sector were named as the reasons for the plans.
This move is expected to result in salary cuts of 25 to 50 percent due to the higher pay that is typically offered in Hong Kong.
Headcount Reduction
Within the investment banking division, around a single-digit figure will be impacted base on performance assessment with the first batch marked for relocation expected to be decided as early as this week.
More are likely to be affected in later rounds with over 30 percent of CLSA’s investment banking workforce of 200 in Hong Kong potentially receiving the offer. More than 80 dealmakers in execution and coverage roles for China deals are amongst those most likely to be affected.
Citic, China’s largest investment bank by market value, joins various other banks that have sought to rein in on costs amid a challenging market environment. In the US, banking giants like Goldman Sachs, JPMorgan and Morgan Stanley have also recently cut China-related investment banking jobs.
