Citigroup Inc. picked a company veteran to head its new China securities firm and poached a senior banker from JPMorgan Chase & Co. to build out its business in the world’s second-biggest economy, people familiar with the matter said.
(Bloomberg) — Citigroup Inc. picked a company veteran to head its new China securities firm and poached a senior banker from JPMorgan Chase & Co. to build out its business in the world’s second-biggest economy, people familiar with the matter said.
The New York-based bank named Kenneth Koo, its chief representative at the disbanded Citi Orient Securities venture, as chief executive officer, the people said, asking not to be identified discussing a personnel matter. Rochelle Wei joined as CEO for Citi’s futures unit from JPMorgan. The firm also hired John Lu, the former head of brokerage at HSBC Qianhai Securities Ltd., as of head of onshore equities, they said.
The lender is setting up its own investment banking business in mainland China after exiting a venture with Orient Securities Co. It joins rivals such as Goldman Sachs Group Inc. and JPMorgan in a push into the $57 trillion financial market after Beijing allowed firms to take full control of ventures in 2020, giving them freer rein to expand and invest.
Citigroup has applied for licenses that will allow it to underwrite yuan-denominated shares, conduct trading for clients and operate a business in futures on the Chinese mainland.
A Hong Kong-based spokesman at Citigroup declined to comment.
The hires underscore Wall Street’s commitment to tapping the Chinese market even as headwinds mount amid slowing growth and rising political tension. Global banks have slowed hiring on the mainland after ramp ups in 2020 and 2021, and earlier this year three top executives at UBS Group AG, JPMorgan and Credit Suisse Group AG in China all stepped aside.
Banks are required to have teams in place before winning approvals for operations, which is a drawn out process. Goldman, for example, waited about 10 months before getting a final nod for its mainland securities firm. An exodus of senior executives Credit Suisse’s mainland China securities venture has delayed its regulatory approval that would allow the build-out of equities trading and wealth offerings.
Morgan Stanley, which has taken control of its securities venture and is moving closer to getting full control of its fund management, hired a head of onshore equities for China in July. JPMorgan, the first Wall Street bank to gain full ownership in August 2021, appointed a new China CEO in April, and Goldman Sachs added a new co-head for the China business the following month.
Wei, who spent almost two decades at JPMorgan, was most recently chairman and CEO for JPMorgan China Futures Co. Lu helped HSBC build out its securities operation since 2017, holding roles across equities cash sales, sales trading, research and equity capital market. He has also worked at UBS Securities Co. and Orient Securities.
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