Deutsche Bank is to pull out of equity underwriting in Asia Pacific as part of the German lender’s plan to axe 18,000 jobs globally.
The cuts to the equity capital markets division started today and affected the entire ECM teams in Japan and Australia, according to people with knowledge of the matter.
Jason Cox, Deutsche’s Asia Pacific head of equity capital markets, is leaving the bank.
Some origination and syndicate bankers in Hong Kong and Singapore will be staying for a while to execute deals in the pipeline before leaving.
Those deals include the US$9.8bn Hong Kong IPO of Budweiser Brewing Company APAC and the US$1bn-plus Hong Kong IPO of Logistics property developer ESR Cayman.
The Chinese listings in the US, such as Wanda Sports Group, are expected to be handled by the US-based teams, said the people.
One source said the decision to shut down the global equities business made ECM underwriting impossible, flagging the potential for further cuts in the future.
Deutsche said on Sunday it will exit its equities sales and trading business globally but retain a “focused equity capital markets operation”, as part of what chief executive Christian Sewing has termed a “fundamental transformation” of the bank.
So far this year, Deutsche Bank ranks 12th for equity and equity-linked underwriting in Asia Pacific, excluding Chinese A-shares and the Japanese and Australasian markets. It arranged a US$750m convertible bond for Chinese electric vehicle maker Nio and the US$687m IPO of Embassy Office Parks REIT, India’s first real estate investment trust.
The bank also won a senior role in the ongoing Budweiser IPO, the world’s largest listing this year, as one of four joint global coordinators, and is is one of two sponsors on ESR’s float.
“The ECM business has been improving a lot in Asia these past few years. It’s a really bad decision for the teams here,” said one of the people.
A spokesperson for Deutsche in Hong Kong declined to comment.
