HONG KONG, Dec 14: Asian investment bankers and brokers spared by this year’s job axe will enter 2002 with trepidation, but experts say further deep job cuts in the region are unlikely as surviving firms try to position themselves for growth in China.

But no one in the industry, from brokers to head hunters, is looking for a snap-back to growth like the one that followed the Asian financial crisis.

Industry observers said investment banks have scaled back their presence in Asia by as much as 20 per cent this year. In Hong Kong alone, more than 1,000 investment banking staff have been thrown out of work.

“Of the jobs lost this year, 50 per cent are likely to remain lost next year. I cannot see what the engine for a boom in investment banking will be,” said Harry O’Neill, managing director and headhunter at Whitney O’Neill in Hong Kong.

Hong Kong, Asia’s biggest capital markets hub outside of Japan, is going through “the biggest re-shaping and re-invention of the industry we have seen in a long time,” O’Neill said.

The largest retreats this year have been in Southeast Asia, namely Indonesia and the Philippines, where HSBC Holdings closed its brokerage units, citing poor liquidity. Among other brokerages quitting the Philippines were Citigroup, BNP Paribas, Nomura and OCBC Securities.

Other firms have shut down their Asian equity operations entirely, including Bank of America, Dresdner Kleinwort Benson and Credit Agricole, the latter two with job losses of 350 each.

But for surviving firms, jobs aimed at servicing China equity businesses — many based in Hong Kong — were less prone to redundancies.

“In China, there is a significant amount of activity. With a pipeline of deals that are waiting to come about next year and the country’s relative lack of seasoned bankers, firms are likely to be hiring again,” said one headhunter.

But others in the industry aren’t so sure, saying there are still enough investment bankers in Hong Kong to execute deals already in the pipeline.

China’s entry into the World Trade Organization, its strong domestic growth and ongoing development of telecoms, financial services, infrastructure and transportation will continue to draw investor attention worldwide, analysts say.

As state enterprises work to boost efficiency in preparation for an expected onslaught of foreign competitors, new opportunities are arising for bankers to advise corporate restructurings.—Reuters