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By Jennifer Yousfi
At a time when Europe and the United States are shedding jobs in the financial sector, one financial center is only adding to its ranks: Hong Kong.
Though it currently holds third place behind London and New York, Hong Kong's presence as a world financial center is growing by the day. Credit Suisse Group (CS) is the latest financial firm to move a top executive to the Asian city.
Vikram Gandhi, the Swiss bank's head of global financial institutions group, will relocate to Hong Kong from New York this summer to tap growth in Asia, Bloomberg News reported.
"As part of our ongoing commitment to transfer talented bankers to other regions, Asia Pacific will benefit greatly from having a banker on the ground with Vikram's experience and client relationships," Jim Amine and Marc Granetz, co-heads of global investment banking at Credit Suisse, wrote in an internal memo. "We are going to continue to align our best bankers with areas of highest potential growth."
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This move follows similar relocations to Hong Kong by top brass at Deutsche Bank AG (DB), Morgan Stanley (MS) and Citigroup Inc. (C) as investment bankers look to cash in on the large number of sovereign wealth, private equity and corporate deals occurring in Asia.
China and the other emerging Asian economies haven't been as adversely affected by the global credit crunch. While deals are slowing down in the United States and Europe, the pace of business is still fast and furious in the Pacific Rim.
"Investment bankers follow the money," Scott Moeller, a Professor at the Cass Business School and former executive with Deutsche Bank and Morgan Stanley, told BBC News.
"With sovereign wealth funds having a lot of money, with Asia having escaped the worst of the credit crunch and with the crunch having hit the U.S. and Europe the hardest, it is not surprising at all," Moeller said. "Once you get critical mass in a location, it begins to snowball and that is what is happening in Asia."
But despite the growing number of deals happening in Asia, competition between Hong Kong and Shanghai is likely to keep the former city from overtaking London or New York as the new global financial capital.
"I would be more worried if I was in a third tier financial center like Paris or Frankfurt than in London or New York," Moeller said. "I don't think London or New York will be losing their crowns as leading financial centers any time soon."
News and Related Story Links:
- BBC News:
Top bankers 'leaving US for Asia'
- Bloomberg News:
Credit Suisse to Move Global FIG Head to Hong Kong