Over the course of the last 18 months there have been very few bullish commentators on the Hong Kong stock market, and despite a natural tendency for us to be optimists, very little has been written or said to give us, or anyone else, cause for optimism.
With this in mind, when contemplating my response, to a banker posing me this question yesterday, I paused. All I could think of were the dire swathes of red under the IPO figures for this year, that I saw on our Bloomberg terminal earlier in the week.
I will not go into my response, but let’s say it was fairly muted.
Fast forward 24 hours and I am reading this article, ‘Bank predicts CSI to rise by 26% in 2013’ on China Daily.
What a difference a day makes!
Three things in particular gave me cause for optimism:-
- It appears that China will provide and adapt polices to support the equities market
- There are 800 IPOs in pipeline for China as a whole, which would mean that Hong Kong ought to be home to a few:- This should provide some well needed revenues for investment bankers.
- The Hang Seng is expected to rise to 25,000 by the end of next year – this can only be a good thing for secondary markets and trading after the volatility and stagnation we have seen over the last 18 months.
It’s good to hear some Bullishness again, after all the bad news we’ve had for what seems a very long time.
Let’s just say that from now until the end of the year, you will find me ever so slightly fuller of Christmas Cheer…
Taco Bell is a great example of a company using social media to effectively interact and connect with their customer base. Through a consistent and targeted use of Twitter, Facebook, Instagram and Pinterest, they are able to integrate these tools into their overall marketing mix.
The activity on Taco Bell’s twitter account shows a unique sense of humour, which can be seen in their replies back to consumer tweets.
Here are some highlights:
Every brand has the exact same social media tools at hand, however Taco Bell has very smartly used a little bit of attitude and humour to respond to their customers and more effectively engage with them. The brand takes on more personality, becoming more human in the process.
Like Taco Bell, consumer and corporate brands can certainly inject a bit of personality into their social media efforts to elevate their brands.
Does your brand’s personality come through in social media? When social media marketing is utilised effectively, it can enhance your brand’s image to create a more approachable and transparent channel for your targeted audience.
Until next time!
So as everyone gets in the festive mood looking towards Christmas and year end, many of us are wondering what presents to buy for our loved ones, thinking about all the dry turkey and spiced wine we will have over the next few weeks.
There are however the fortunate, or perhaps optimistic few within the banking world thinking about the extra money they’ll receive from their 2012 bonus. Many professionals within the banking and finance industry remain unsure as to how the bonus pool will look this year, but it seems many are still feeling somewhat hopeful for a good bonus. Let’s take a look at a few influencing factors.
Arguments for higher bonuses
- It would appear that whilst most bonus pools will likely be down this year, the reduction in headcounts across most teams could mean an increase on bonuses individually, with less people for the pot to be shared amongst.
- Many people within the banks will tell you, they have been working longer hours this year, many noting that reductions in staff levels this year hasn’t necessarily been due to a decrease in overall workload with the remaining staff taking on additional responsibilities and duties.
Arguments for lower bonuses
- Trading volumes have been down, and with that, revenues and profits have struggled in many areas, such as cash equity trading. It is likely that people covering certain investment product areas can expect a decrease off the back of this.
- There is an increasing pressure from the general public and even governing bodies, reportedly the FSA in the UK, that bonuses should be significantly reduced as banks look to make up for mistakes and stop rewarding the idea of short term gains and misrepresentation.
- Many banks implemented a new compensation structure over the last couple of years in which base salaries were higher and bonuses were reduced, so despite bonuses being down total compensation was at a similar level. As such, it would appear that this will likely continue to be a trend with bonuses potentially going to be down year on year.
It’s going to be a hard one to predict with people within the banking and finance industry feeling a good bonus is deserved and many others outside feeling the opposite. Either way, whether it’s higher or lower, hopefully it won’t ruin their festive season or their start to 2013!
‘Here is the City’ recently wrote an article describing how the New York and Hong Kong financial services markets would outgrow London in four years. If this is the case, this has got to be some positive news for the Hong Kong financial services sector.
The key arguments are sound enough with the article citing internationalisation of the RMB, economic growth in China and a more favourable regulatory environment. However, I think it doesn’t really take into account the challenges that Hong Kong faces against the nearest financial hubs of Singapore and Shanghai, and therefore potentially, the article is solely ‘pinning the tail’ on Hong Kong as many similar arguments could be applied to these other regional hubs.
For example, the Singapore government has significant tax incentives to new employers building out in the region and a recent article suggested that 57% of global multinational companies would consider Singapore over Hong Kong as their regional headquarters, and this is bound to have an impact on the growth here in Hong Kong.
That being said, traditionally, Singapore was seen as a lower cost option as salaries and the cost of living plus corporation tax rates made it favourable. With the strength of the Singapore dollar and the weakness in the greenback, there are many arguments to say that this is now not the case and the cost of living in Hong Kong is on par or even lower than Singapore.
Shanghai will surely become a significantly more mature market in due course with the internationalisation of the RMB and the growth of the domestic banking market, and this too will challenge this statement.
Even so, a 3.5% growth in the total number of city-type jobs in Hong Kong by 2017 to an estimated 277,000 will undoubtedly be good for the financial services market and the regional economy. This is a good thing for financial professionals in the Hong Kong market and those looking to move to Asia for their next career opportunity! However, it will put a significant pressure on the talent pool and the ability for financial services organisations to attract and retain their employees.
Morgan McKinley’s Hong Kong 2013 Hiring Market Report is now available. It provides analysis of trends and forecasts based on our survey of employers. We surveyed over 700 hiring and operational managers across financial services, as well as commercial organisations in Hong Kong and the Asia-Pacific region to give you a valuable insight into hiring trends for 2013.
We have also carried out similar research across China and Singapore and have included some of those findings in comparison to our findings across Hong Kong to highlight the similarities and differences in perspective across these three markets.
Download a copy of the latest Morgan McKinley Hong Kong Hiring Market Report here
I think – yes. With Obama’s re-election today this should be a positive news story for Asia and Hong Kong specifically. With the dollar-peg in Hong Kong, the US fiscal policy has a dramatic effect on businesses and individuals in the territory.
Obama was the safer bet in terms of him being positioned well after his four year term to negotiate with congress and get things done and this has got to be good news for the region. Furthermore, Mitt Romney’s outspokenness over US-China trade ties would have created significant tension between the two economies. Finally, I would say that stability, rather than change, in the US should allow for the US recovery to continue and further benefit the global economy as a whole.
So will the markets respond well to the news? I hope so but only time will tell……
After the terrible shock of Hurricane Sandy the US seems to be getting back to normal. Certainly the Presidential election is filling many column inches in the western press, whilst the upcoming Chinese leadership change is filling practically none. It is a fascinating time to see how these two global economic powerhouses work through their choices for an uncertain future. Our COO, Richie Holliday discusses this further.
To read more, click here.
Having read this recent article with interest, ‘Japan loses key finance roles to Hong Kong’ , I thought I’d look at some of the factors which could explain why these organisations have taken the decision to relocate key roles out of Japan.
With the venue for these new or consolidated roles to be Hong Kong, and the prominence of equities as an asset class here, I thought I’d look at this market and put forward 3 key factors which could have influenced management.
1. At the start of this year, the Japanese stock market has fallen to the level of 30 years ago.
Flight to safety, diversification of Japanese assets overseas, whatever the reasons, money has been leaving Japan for some time. Not the best of backdrops to increase headcount – in fact, the exact opposite.
2. The top 5 Japanese firms have brokered near on 90% of Japanese equity offerings this year.
In terms of underwriting, we have witnessed a significant decline in equities underwritten by foreign firms in Japan in recent years. Goldman Sachs, JP Morgan and Citi accounted for 20% of new issuances in 2009; this year they have accounted for just 2.2%.
3. Decline in OTC and rise in electronic trading
As demand for complex products diminishes, and markets become more automated, international brokers are increasingly using technology to supplement manpower. With less staff, there is less need for experienced ‘man-managers’ to be present on the ground in Tokyo.
With a beleaguered stock market, a very competitive landscape and technological factors reducing the need for team numbers on the ground in Japan, it is not surprising that international firms may seek to roll up Asia ex-Japan and Japan sales and trading activities under a regional head, and move towards fast growing Asian economies.
Given pressure on headcounts, it would be unsurprising if this decision had been taken to save costs, and may be a direct consequence of a shift towards low touch trading.
What is surprising is the decline in capital market activity that international banks are underwriting in Japan, and it’s bound to have a knock-on effect on their success in secondary markets.
With IPO issuances up 20% in Japan year on year, with a value of US$10bn (almost twice that of Hong Kong), these firms are clearly missing a large slice of the pie.
This leads me to a question:-
Is the preference of Japanese firms to use domestic brokers a “better the devil you know” reaction to the economic downturn, or have those brokers simply hired top talent from their foreign competitors to get to the top of the pile?
When I heard that ‘Headhunters’ was coming out, I thought great! Finally a movie about our industry with the potential to offer a realistic warts and all portrayal of what we do day to day. A movie in a similar vein to: The Devil Wears Prada (fashion), Margin Call (investment banking) and Up in the Air (corporate downsizing).
Needless to say, the movie left me a bit wide-eyed! All in all, it is an enjoyable light-hearted thriller, adapted from the book written by the excellent Jo Nesbo. No spoiler alerts here – the movie details the life of Roger Brown, a successful headhunter who leads a double-life of recruitment and crime. The movie depicts some aspects of a recruiter’s role well; we do experience extreme highs and lows as well as constantly needing to think outside of the box.
There are a few take-away points that I was able to extract from the movie. Roger shows a ‘Terminator’ like level of determination and focus, his will to win and be successful against a never ending series of twists and turns is admirable. He gets repeatedly knocked down, however picks himself up again time after time and keeps on going. In life you need to be adaptable and have the ability to roll with the punches, if ‘life gives you lemons make lemonade’. Look forward, ignore distractions and never lose sight of your goals.
Mr Brown uses his interviewing skills and takes time to understand not only his candidate’s work experience but also their interests and life outside of work. A good headhunter will seek to build a long term relationship with their business partners rather than simply offering a transactional service of ‘job-matching’.
Image and reputation is also critical to Roger – be the person you want to be and project that image externally. In order to be successful, personal branding is crucial. Roger’s reputation within the executive search industry in Oslo is of utmost importance to him, he will do anything to protect and uphold his reputation both in the corporate world and in his personal life.
Until next time!
Apple has just released the new Iphone 5 to much fanfare and you’ll either be in the ‘love it’ or ‘will reluctantly buy it later’ category.
We have also just passed the one year anniversary of Tim Cook’s tenure as Apple CEO having taken over the role from Apple founder and icon, the late Steve Jobs.
Under his stewardship – Cook has successfully launched the Iphone 5; their share price continues to rise; Apple has settled an intellectual property lawsuit against Samsung, and Cook has also carried on Steve Job’s legacy. He continues to embrace Apple’s core principles (innovation, user experience, and excellence) whilst also imparting his own distinct management style over the company.
Apple has shown the critical importance of having a strong succession plan. Over time Apple, Steve Jobs and its board of directors developed and executed their CEO succession plan through promoting Cook. By giving Cook more responsibilities and having him serve as caretaker CEO whenever Jobs was on medical leave, Apple has been able to effect a smooth transition for this key leadership position.
In this current employment environment, hiring and also retaining talent is a key issue facing organisations of all sizes. The implications of an organisation not being able to hire the right person magnifies the longer a position is left vacant (leadership vacuum, lost business opportunity, effect on staff morale, negative company perception externally). There are many examples of organisations that have suffered without having a strong succession plan, eg : HP, Yahoo!, Simon Cowell leaving American idol.
Companies that do not have a succession plan in place for employees at all levels also face the consequence that these employees may leave if there is not a sustainable career path in front of them.
Until next time.