Citi to boost Japan, China investment banking teams, plans senior sector-focused hires

[HONG KONG] Citigroup will bolster its Japan and China investment banking teams by adding selective senior bankers, the bank’s Asia investment banking head told Reuters on Monday (Apr 27).

This comes as the firm aims to win more cross-border mergers and acquisitions (M&A) deals.

Despite the ongoing conflict in the Middle East, Citi is moving forward with efforts to grow its in-market presence in the region, after completing its years-long global restructuring.

Asia deal activity remains resilient, driven by sector fundamentals and strategic corporate agendas, said Kaustubh Kulkarni, who became the sole head of regional investment banking after former co-head Jan Metzger left to join Standard Chartered in March.

Some smaller emerging markets, such as Indonesia and Malaysia, that are sensitive to energy shocks have seen slower initial public offering and capital-market activity, but the forces driving deals in Japan, Korea and Taiwan are less energy-sensitive, he added.

Kulkarni said that the Wall Street bank plans to add selective senior hires in Japan to close coverage gaps, such as in the technology, media and telecommunications sector, and provide the seniority Japanese clients value.

“Japanese companies are becoming a lot more creative and open for strategic conversations,” he noted, adding that governance-driven corporate structure changes and activism are behind the increased client interest.

The bank aims to improve coordination between local and international teams to win cross-border M&A and sponsor work, Kulkarni said.

Citi’s global investment banking fees grew 12 per cent year on year in the first quarter.

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In China, Citi is awaiting a final green light from the authorities to allow it to operate its own securities unit, which will house its onshore investment banking team.

Kulkarni said that the operation is already in the hiring mode for China, with a focus on bringing in investment bankers who can cover “new-age” and “high-growth companies”, without disclosing details.

The Chinese offshore market of Hong Kong has seen its equity capital markets mark the strongest start to a year since 2021, with over HK$140 billion (S$22.7 billion) raised in IPOs by late April, representing a more than 400 per cent increase compared to a year earlier.

Citi is also mulling a third senior hire in Australia to complete a planned build-out, Kulkarni said. This comes after two senior bankers in healthcare and natural resources were brought in to fill sector leadership gaps. REUTERS