BNP Paribas made its first round of layoffs in China investment banking since an expansion two years ago, cutting about 10 jobs amid a sluggish market for deals, sources familiar with the matter said.
BNP let go seven Hong Kong-based staff across investment banking, corporate finance and equity capital markets last week, along with three from its mainland offices. The cuts affect about 10 per cent of the bank’s China-related headcount, one of the sources said. A managing director responsible for signing off on initial public offerings was among those laid off, the sources said.
This marks the first headcount reduction since the French lender expanded its China investment banking team in 2022, adding more than 20 dealmakers to target stock sales and cross-border mergers. The cuts primarily affected staff in equity underwriting as the bank shifts its focus to mergers. BNP also made reductions in its corporate and transaction banking divisions, one source said.
A spokesperson for the bank declined to comment.
The Paris-based firm received approval in April to build its securities operation on the mainland, re-entering the market after exiting a local joint venture 17 years ago. In the past two years, Morgan Stanley, Goldman Sachs Group and JPMorgan Chase have all made rounds of job cuts in Hong Kong and China, mostly in their investment-banking businesses as stock underwriting fees dwindle.
BNP, led by Asia chief executive officer Paul Yang since 2020, has instead focused on corporate banking in China, broadening the mix of revenue from financing, transaction banking, cash management and fixed-income sales.
Chinese stock sales have fallen to their lowest level in two decades, with just US$23.4 billion raised this year, according to data compiled by Bloomberg. While sentiment has improved as more Chinese firms consider public listings in Hong Kong, global banks face increased competition from local players and a tougher regulatory environment.
Investor reaction to China’s latest round of stimulus measures has been mixed, and a rally in Chinese stocks last month has lost momentum due to scepticism about China’s economic rebound and growing unease over its relationship with the US. President-elect Donald Trump is expected to appoint two advisers with a history of harshly criticising China, and has threatened to impose a 60 per cent tariff on Chinese goods, a move that could stifle trade between the world’s two-largest economies. BLOOMBERG
