A pair of large Chinese investment banks are reportedly planning to lay off nearly one-third of their staff amid a difficult environment for new listings.
Two large Chinese investment banks plan to gradually lay off around 30 percent of staff, according to a report by local media «Sing Tao Daily» (translated from Chinese).
The layoffs, which involve more than 100 people, cover roles in investment banking, equity capital markets and other departments including junior staff and the Hong Kong team.
Top-10 Sponsor
One of the two investment banks has been ranked among the top ten sponsors of initial public offerings (IPO) in Hong Kong many times in recent years, according to the report which did not disclose the name of the firm.
The investment bank is believed to be cutting staff after having taken advantage of the booming IPO market last year to expand in Hong Kong, including the addition of more than 10 responsible officers (ROs) who can each be responsible for two or three new listing applications at most.
IPO Winter
After a strong year in 2021, Hong Kong has faced a sharp reversal in the IPO market due to the lack of large listings and intensified supervision by the local bourse for smaller listings.
According to data from the Hong Kong Exchanges and Clearings, the city registered a total of 19 new listings on the main board which raised around HK$15.9 billion ($2 billion), as of the end of April, down 46 percent and 90 percent year-on-year.
While the outlook remains weak in the near term, optimistic onlookers are hoping for an accelerated return of U.S.-listed Chinese stocks to the Hong Kong exchange.
