Being a China-Connected Global Banker Isn’t What It Used To Be

Competition from Chinese bankers and strict regulations are reducing business for US and European banks, reports Cathy Kit Ching Chan for BloombergBusiness. Some top investment bankers are resigning, and their posts go unfilled. The report notes that “risk and compliance departments at global banks have become more vigilant about turning down deals in China that might have political connections, and thus could fall afoul of restrictions on banks’ dealings with politicians, leaving the way open for the Chinese institutions.” Global bankers want to avoid charges of money laundering, tax evasion or violations of the US Foreign Corrupt Practices Act by favoring Chinese business and political leaders or their relatives. Chinese bankers earned about 75 percent of the total investment banking fees earned during the first six months of 2015. Analysts suggest that foreign banks will tread carefully in China, specializing in areas like “wealth management, the distribution of large debt or equity offerings among international clients, and derivatives trading.” – YaleGlobal