Credit Suisse is preparing to lay off half of its mainland China investment banking team, according to Chinese business publication Caixin, after saying earlier this week it is looking to fully acquire its Chinese securities joint venture and expand its presence in the market.
The Swiss banking giant is planning an overhaul of its joint venture, Credit Suisse Founder Securities, that includes cutting its 85-member investment banking team in half and filling some of those vacancies with employees from its Hong Kong unit, Caixin reported Thursday, citing anonymous sources.
Credit Suisse didn’t immediately return a request for comment.
The news comes after Credit Suisse’s Asia Pacific CEO Helman Sitohang said earlier this week that the bank is hoping to fully acquire the joint venture and hire more staff in China.
“We will continue to invest across our platforms in China and closely integrate our onshore operations with our businesses in Hong Kong and across the region. There will be more hires, some of which we will announce shortly,” Sitohang said in an interview with Reuters this week. “It is clearly about tactical hiring: We want to capture opportunities. We know exactly where these are, where we see potential to improve, and that is what we are focused on.”
In June, Credit Suisse, which has about EUR 724 billion ($818 billion) in total assets, raised its stake in the joint venture from 33.3% to 51% to take advantage of regulatory restrictions on foreign ownership that were eased in 2018 and scrapped in April. It also installed investment banker Janice Hu as chairwoman of the entity.
Hu will likely shake up the company, which has posted middling results in recent years, according to Caixin. In 2019, the joint venture recorded a net loss of CNY 41.8 million (about $6 million), missing its net profit target, its annual report shows.