(11 March 2022 – Asia) JPMorgan has accelerated plans to relocate some of its top investment bankers in Hong Kong to mainland China as draconian pandemic restrictions have made travelling from the territory to meet clients almost impossible.
The FT reports that the Wall Street bank has also run an analysis on how to make “overnight relocations” of key staff from Hong Kong to Singapore in recent weeks as part of contingency plans for a full shutdown of markets in the Chinese territory, which is suffering its worst outbreak of coronavirus.
JPMorgan is the latest international lender in Hong Kong to plan for significant changes to its regional operations as more than two years of restrictions on travel have led to an exodus of workers, concerns about operational problems and questions about its future as a global financial centre.
Hong Kong’s “fly-in, fly-out model is currently broken”, said an executive close to JPMorgan. “Having bankers in Hong Kong to cover mainland China clients doesn’t make sense.”
The bank will speed up an expansion of its mainland investment bank to mitigate the travel problems in Hong Kong by relocating a small number of top dealmakers to Shanghai, according to the executive and another person close to the matter the FT spoke with. Currently, executives travelling from Hong Kong to mainland China have to undergo a two or three-week quarantine on both legs of their trip.
A series of executives have relocated from Hong Kong to Singapore, London, Australia and the US in recent months as the territory has further tightened restrictions on socialising, closed schools and announced plans for citywide compulsory testing of its 7.5mn residents.
There has been a net outflow of more than 100,000 people since the beginning of February.